Caterpillar Inc. keeps raising the bar on sales and earnings expectations, and the machinery maker keeps topping it.
The Deerfield, Illinois-based company projected 2017 sales of $44 billion, marking a third-straight increase in annual revenue projections. It also raised its earnings forecast. Caterpillar said in a statement Tuesday that third-quarter sales were $11.4 billion, higher than analysts’ estimates and compared with $9.16 billion a year earlier.
Estimates for Caterpillar earnings rose 22 percent the past three months, by far the most in the Dow Jones Industrial Average, amid signs of improving demand in mining and rising sales of construction equipment in China. Caterpillar’s shares were the second-best performer in the equities index. Chief Executive Officer Jim Umpleby, who took over in January, has the company on track for its first annual sales gain since 2012.
“The big key markets should be in recovery mode in a pretty big way after what was a rough four years,” Matt Arnold, an analyst at Edward Jones & Co. in St. Louis, said in a phone interview. “We’ve seen the dealer stats each month, and there’s plenty of evidence the revenue recovery is coming along nicely.”
Caterpillar reported Monday that retail machine sales in the three months ended September grew at the fastest pace since 2012, adding to evidence that the recovery is gathering steam. The company posted double-digit percent sales declines every month in the two years through 2016.
In July, Caterpillar forecast 2017 sales and revenue of $42 billion to $44 billion. The company said at the time it expected per-share profit of about $3.50 at the midpoint of the sales range.
Excluding one-time items, third-quarter profit was $1.95 a share, more than the $1.25 average of 17 analysts’ estimates compiled by Bloomberg.
The company’s shares climbed about 16 percent in the third quarter. They jumped 7.2 percent to $141.15 at 7:47 a.m. in New York, before the start of regular trading.
“Caterpillar continues to see strength in a number of industries and regions, including construction in China, on-shore oil and gas in North America, and increased capital investments by mining customers,” it said in the statement.