Caterpillar Dealer Sales Trends Looking Less Bad

Industrials

Published: August 20, 2014 11:05 am

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Caterpillar Inc. (NYSE: CAT) has had a wild ride in 2014. Its fundamentals have never really improved to where they had been in the prior years, and it looked at the start of 2014 to have the worst fundamentals of all Dow stocks in our bull and bear analysis at the start of the year. Yet here we are in August and the 20% or so gain year to date makes Caterpillar the third best-performing Dow stock of 2014.

On Wednesday the company released its monthly dealer sales data for July. It seems odd to think that a 9% drop in total global demand is good, but that number had been a drop of 10% in the full second quarter.

Mining equipment was down by 33%, but that was 38% previously. Energy and transportation is very broad, but that drop fell to -5% rather than roughly -10% seen previously.

As you can see in the table below for the total machines reporting, Latin America was the only region for Caterpillar that worsened in the monthly drop — down to -23% from -18%. North America’s gain of 11% compared to a gain of 14% the prior month. Then, if you look at the Energy & Transportation Retail Sales, it looks as though the rolling three-month period showed improvements (even if some were just less-bad) over the prior report.

Caterpillar shares were up 0.5% at $107.80 in Wednesday morning trading. Its 52-week range is $81.46 to $111.46, and the consensus price target from analysts is up at $113.24.

A full table from Caterpillar’s SEC filing has been provided below.

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