Shares of Caterpillar Inc. (NYSE: CAT) plunged 4% during the pre-market hours on Wednesday after the company missed market estimates in the third quarter and slashed its EPS outlook again.
Revenue for the third quarter fell 6% to $12.8 billion, well below the street target of $13.6 billion. The heavy-machinery manufacturer blamed lower-than-expected end-user demand and reduction in inventories by dealers or the lower revenues.
Net income fell to $2.66 per share from $2.88 per share a year ago. Wall Street was expecting flat year-over-year EPS of $2.88 per share.
The company also slashed it outlook EPS outlook to a range of $10.90 to $11.40, compared to the earlier estimate of $12.06 to $13.06 per share.
CEO Jim Umpleby said in a statement, “In the fourth quarter, we now expect end-user demand to be flat and dealers to make further inventory reductions due to global economic uncertainty. Caterpillar’s improved lead times, along with these dealer inventory reductions, will enable us to respond quickly to positive or negative developments in the global economy in 2020.”
CAT stock has gained 5.5% in the year-to-date period.
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