Caterpillar Q2 Earnings Preview: Trump Tariff Impact And Power Equipment Business In Focus
Synopsis
Wall Street expects the company to post earnings of $4.9 per share, on revenue of $16.22 billion for the quarter ended June 30.
Caterpillar (CAT) stock has slipped marginally over the past week ahead of its quarterly earnings report, scheduled for release before the bell on Tuesday.
According to Fiscal.ai data, Wall Street expects the company to post earnings of $4.9 per share, on revenue of $16.22 billion for the quarter ended June 30. The industrial machinery maker has topped estimates in two of the previous four quarters.
Its first-quarter sales had declined 10% compared to the same period a year earlier, due to changes in dealer inventories as well as fluctuations in currency valuation.
Like its peers, Caterpillar has been grappling with uncertainties related to U.S. President Donald Trump’s tariff policy, which threatened to erode demand. In April, the company projected a hit from tariffs between $250 million and $350 million in the second quarter.
However, several trade deals between the U.S. and its key trading partners have alleviated fears about a recession.
Retail sentiment on Stocktwits about Caterpillar was in the ‘bullish’ territory at the time of writing, while retail chatter was ‘high.’
In July, Oppenheimer analysts wrote in a broader sector note that temporary reprieves on tariffs will likely support second-quarter margin upside for the majority of stocks under its coverage, along with demand pull-forward for select names, according to The Fly.
Caterpillar, one of the world’s top makers of mining, construction, and power equipment, will likely also book strong orders related to its energy and transportation segment. Power equipment makers have benefited this year from a surge in electricity demand in the U.S., which is rising at its fastest pace since World War II, driven by the growth of AI data centers.
Caterpillar stock has gained 18.7% this year.
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