{"id":6961,"date":"2018-04-24T11:31:08","date_gmt":"2018-04-24T15:31:08","guid":{"rendered":"http:\/\/lifeinsurance-orleans.ca\/Life-Insurance-Blog\/?guid=72769b88b11427595b29450dd531c440"},"modified":"2018-04-24T11:31:08","modified_gmt":"2018-04-24T15:31:08","slug":"the-company-considered-the-bellwether-of-the-global-economy-just-smashed-expectations","status":"publish","type":"post","link":"https:\/\/blog.lifeinsurance-orleans.ca\/index.php\/2018\/04\/24\/the-company-considered-the-bellwether-of-the-global-economy-just-smashed-expectations\/","title":{"rendered":"The company considered the bellwether of the global economy just smashed expectations"},"content":{"rendered":"<p>CHICAGO \u2014 Caterpillar Inc on Tuesday upgraded the outlook for 2018 profits after the world\u2019s largest heavy-duty equipment maker beat estimates for first-quarter earnings on strong global demand for its equipment.<\/p>\n<p>Shares in Caterpillar, part of the Dow Jones Industrial Average, were last up 3 per cent at US$158.66 on the New York Stock Exchange.<\/p>\n<p>The Deerfield, Illinois-based company now expects the full-year profit to range between US$9.75 to US$10.75 per share, US$2 above its range in January.<\/p>\n<ul class=\"related_links\">\n<li><a href=\"http:\/\/business.financialpost.com\/investing\/investing-pro\/its-not-all-doom-and-gloom-for-canadian-stocks-despite-the-economic-risks\">It&#039;s not all doom and gloom for Canadian stocks, despite the economic risks<\/a><\/li>\n<li><a href=\"http:\/\/business.financialpost.com\/investing\/investing-pro\/the-right-way-to-work-economic-factors-into-your-investment-decisions\">The right way to work economic factors into your investment decisions<\/a><\/li>\n<li><a href=\"http:\/\/business.financialpost.com\/investing\/funds\/goldman-sachs-says-you-must-own-commodities-in-these-tense-times\">In these tense times, Goldman Sachs says owning commodities is a must<\/a><\/li>\n<\/ul>\n<p>The company, which serves as a bellwether for global economic activity, has been benefiting from a global economy that is having its best run since 2011.<\/p>\n<p>In the quarter to end-March, revenues rose 31 per cent on year to US$12.9 billion, above Wall Street\u2019s expectations, as strong commodity prices and increased construction activities in North America and China drove up sales of mining and construction machines.<\/p>\n<p>Increased rail traffic in North America, meanwhile, helped lift sales at its transportation division.<\/p>\n<p>Overall sales were also boosted by favorable currency impacts and improved price realization.<\/p>\n<p>\u201cAll in, a solid beat and raise quarter which should get reflected in the market, in our view,\u201d analysts at Jefferies said about Caterpillar\u2019s earnings in a note.<\/p>\n<p>With the International Monetary Fund predicting robust global growth for the next two years, demand for its equipment is expected to remain strong.<\/p>\n<p>Caterpillar said its stronger outlook was primarily driven by better-than-expected sales volume as it saw higher demand across all regions and most end markets.<\/p>\n<p>While it sees broad-based growth in global construction demand, North America and China are expected to be the biggest drivers.<\/p>\n<p>The company expects power generation sales to increase in 2018 after a multi-year downturn. Similarly, improved global economic conditions and a recovery in commodity prices are seen encouraging miners into ramping up capital spending, it said.<\/p>\n<h3>Trade Worries<\/h3>\n<p>Yet, threats of a global trade war pose the biggest risks for a company that sells more than half of its machines outside the United States.<\/p>\n<p>In its annual report earlier this year, the company warned that \u201cbuy national\u201d policies or retaliation against such policies could adversely impact its operations.<\/p>\n<p>Its 2018 forecast, however, did not include any potential impact from future geopolitical risks and increased trade restrictions.<\/p>\n<p>The company reported a net profit of US$2.74 per share for the quarter, above analysts\u2019 consensus forecast of US$2.04 per share. Adjusted net profit was US$2.82 per share.<\/p>\n<p>Caterpillar repurchased US$500 million of its shares during the quarter. It had US$7.9 billion of cash on hand on March 31.<\/p>\n<p>\u00a9 Thomson Reuters 2018<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Caterpillar beats estimates and raises 2018 profit outlook in huge vote of confidence for economy<\/p>\n","protected":false},"author":578,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[],"tags":[],"jetpack_featured_media_url":"","_links":{"self":[{"href":"https:\/\/blog.lifeinsurance-orleans.ca\/index.php\/wp-json\/wp\/v2\/posts\/6961"}],"collection":[{"href":"https:\/\/blog.lifeinsurance-orleans.ca\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/blog.lifeinsurance-orleans.ca\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/blog.lifeinsurance-orleans.ca\/index.php\/wp-json\/wp\/v2\/users\/578"}],"replies":[{"embeddable":true,"href":"https:\/\/blog.lifeinsurance-orleans.ca\/index.php\/wp-json\/wp\/v2\/comments?post=6961"}],"version-history":[{"count":1,"href":"https:\/\/blog.lifeinsurance-orleans.ca\/index.php\/wp-json\/wp\/v2\/posts\/6961\/revisions"}],"predecessor-version":[{"id":6964,"href":"https:\/\/blog.lifeinsurance-orleans.ca\/index.php\/wp-json\/wp\/v2\/posts\/6961\/revisions\/6964"}],"wp:attachment":[{"href":"https:\/\/blog.lifeinsurance-orleans.ca\/index.php\/wp-json\/wp\/v2\/media?parent=6961"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/blog.lifeinsurance-orleans.ca\/index.php\/wp-json\/wp\/v2\/categories?post=6961"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/blog.lifeinsurance-orleans.ca\/index.php\/wp-json\/wp\/v2\/tags?post=6961"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}