Caterpillar Posts Strong Revenues

by Jack Bibey | Thursday, Jan 26, 2012 | 323 views

Heavy duties vehicle manufacturer Caterpillar was able to declare outstanding results on the back of sales to the developing economies and a strategic plans on acquiring new clients during the quarter. Caterpillar Inc. reported top line growth revenues of $60.14 billion, an increase of 41 percent from $42.59 billion in 2010. Adjusted PAT 2011 was $4.93 billion, an 83-percent increase from $2.70 billion in 2010. Profit per share of $7.40 was up 78 percent from $4.15 in 2010. Excluding the impact of the acquisition of Bucyrus International, 2011 profit was $7.79 per share, up 88 percent from a year ago.

Research companies like Goldman Sachs have raised a buy call on the scrip due to its impressive performance. The company has been able to focus on key drivers such as the North American Construction region has witnessed growth. Goldman raised 2012-13 EPS by an average of 10% to $10.10/ $11.95 due to a sharper US construction equipment recovery, lower pension, and share gains in Europe and Asia construction equipment markets.

Revenues have been impressive for the fourth quarter. Sales and revenues in 2011 were an all-time quarterly record at $17.24 billion, an increase of 35 percent compared with $12.81 billion in the fourth quarter of 2010. Adjusted profit was $1.55 billion compared with $968 million in the fourth quarter of 2010. Profit of $2.32 per share was 58-percent higher than the $1.47 per share in the fourth quarter of 2010.

We maintain a buy on the stock due to its impressive income and also distributed growth in various verticals. Commenting on the results CEO Doug Oberhelman stated “We improved product quality, invested significantly in manufacturing capacity and product development, and improved our market position. We completed two large acquisitions — Bucyrus and Motoren- Werke Mannheim Holding GmbH — in important growth industries that are a great strategic fit and provide our customers an even broader range of products.

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