Caterpillar Inc (NYSE:CAT) Grows Amidst Morose Global Economic Health


The global economy is currently going through a bad period as most companies are suffering from losses. Despite all these tribulations, accompanied by low revenue, Caterpillar Inc (NYSE:CAT) succeeded in giving Dow Jones industrial a healthy opening when it opened on Thursday morning. Caterpillar (NYSE:CAT)’s operating profit of 1.4 billion dollars and revenue of 13.5 billion dollars was surprisingly lower than last year’s earnings. But that didn’t stop it from growing its per share price which reached 1.63-1.72 dollars.

Caterpillar (NYSE:CAT) improved its yearly earnings forecast to 6.00 dollars per share as compared to last year’s 5.75. Caterpillar (NYSE:CAT) will be focusing on growth oriented monetary policies emphasizing on stabilizing interest rate and considerable infrastructure investments. Caterpillar (NYSE:CAT) is of the view that their estimates for the global economic growth will turn out correct as 2015 will likely be a good year for global earnings. Although, Caterpillar (NYSE:CAT) isn’t entirely depending upon global economic growth; it has strategies up its sleeve that it will deploy in due time.

Caterpillar (NYSE:CAT)’s main focus is on its operational performance and revenue growth, which will result in better numbers. The global economic scenario won’t help Caterpillar (NYSE:CAT) in any way, even if it improves in the next year as well. Caterpillar (NYSE:CAT) is emphasizing on sharpening its operational execution and is also planning to deploy the strategy of capital. This year, Caterpillar (NYSE:CAT) purchased back its stock worth 4.2 billion dollars and raised its quarterly dividend by 17 percent.

Analysts have marveled at Caterpillar (NYSE:CAT)’s ability to cultivate good EPS on a weak revenue growth and Caterpillar (NYSE:CAT) is riveted upon its valuation expansion. Caterpillar (NYSE:CAT)’s optimism is based on the fact that business operations in the growing market of China and in the mighty Europe are improving with time; regardless of how the world economy plays out, Caterpillar (NYSE:CAT) will stick to its operations and keep working on its priorities. Shares of Caterpillar (NYSE:CAT) soared high- about 3.3 percent when the market opened on Thursday.

This is a clear indication of the fact that investors consider Caterpillar (NYSE:CAT) worth betting on. The reason is perhaps its ability to sustain and survive in the wilderness. When the whole market is taking a harsh hit from the global let-down in the stock market, Caterpillar (NYSE:CAT) is simply strolling towards its goals. And though it is a fact that its revenues are flat, it won’t make a slight difference to their goals in the longer run. Caterpillar (NYSE:CAT)’s strength can also be evaluated on the fact that it’s doing well in a tough market like Europe.

The Chinese market will provide sufficient back up but withstanding the competition in the Euro-zone is something that requires strength, abilities and capabilities- all of which can be found in abundance in Caterpillar (NYSE:CAT). Caterpillar (NYSE:CAT)’s goal should be to reverse the flat revenues into significant profits so that the company can be known for its survival and conquering skills as well, rather than being a mere survivor.