Caterpillar stock jumps as construction propels third-quarter earnings

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caterpillar (CAT) – Get the Caterpillar Inc. report released stronger-than-expected third-quarter results on Thursday as a rebound in demand for construction equipment, along with soaring commodity prices, helped boost the industry group’s results.

Caterpillar said adjusted earnings for the three months ending September were pegged at $2.66 per share, up nearly 100% from the same period last year and well ahead of the forecast. Street consensus of $2.20 per share. Group revenue, Caterpillar said, rose 25% to $12.4 billion, a figure that narrowly beat analysts’ estimates of a total of $12.5 billion.

Operating profit margin was 13.4% for the quarter, compared to 13.7% in the prior three-month period. Caterpillar also noted that it ended the quarter with $19.4 billion in cash, down from $10.8 billion after the three months ending in June.

“Our global team continues to execute on our long-term strategy of profitable growth while working to mitigate supply chain challenges as we serve our customers,” said CEO Jim Umpleby. “Our third quarter results reflect increased sales and revenue in our three main segments and in all regions.

Caterpillar shares rose 2.7% in early trading after the earnings release to change hands at $201.20 apiece.

Construction sales increased 30% to $5.255 billion, Caterpillar said, “higher end-user demand and the impact of dealer inventory changes.” Overall, dealers reduced inventory more in the third quarter of 2020 than in the third quarter of 2021.”

Resources, energy and transportation sales increased 32% to $2.406 billion on “higher sales volume driven by increased end-user demand for equipment and spare parts, partially offset by the effects of variations in dealer inventories”.

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