Caterpillar's Q4 Revenue Miss Triggers Stock Drop
Caterpillar (CAT) shares declined after the company announced fourth-quarter results below expectations before market open on Thursday.
Revenue Decline
Total revenue for the quarter stood at $16.2 billion, a 5% year-over-year decrease. This shortfall spanned multiple business segments:
* Construction Industries: 8% decrease to $6 billion
* Resource Industries: 9% decrease to $2.96 billion
* Energy and Transportation: Flat at $7.65 billion
Caterpillar attributed the decline to reduced sales volume stemming from diminished dealer inventories. Dealer inventory fell by $1.3 billion in Q4, compared to a $900 million decrease in the prior year.
Earnings per Share
Despite the revenue miss, Caterpillar reported record earnings per share of $5.78, exceeding analysts' estimates and representing an increase from the previous year's $5.28.
Bellwether Stock
Caterpillar is recognized as a bellwether stock, reflecting broader domestic and global economic trends. The company's performance is often seen as an indicator of economic expansion or contraction.
Market Reaction
Caterpillar shares fell approximately 5% during Thursday's trading session. Despite the Q4 setback, the company's stock has gained around 25% over the past 12 months.