PEORIA, Ill. (WMBD) — Caterpillar reported an earnings drop Tuesday in its third quarter results.
Local financial planner Rockie Zeigler said the pandemic is part of the problem for a lot of businesses, including Caterpillar.
“I think it’s a total pandemic thing, just my personal opinion. And the reason I say that is the global economy, especially our economy here nationally, was doing quite well before the pandemic hit and we were seeing an increase in demand across the board in a number of sectors,” said Zeigler.
Caterpillar’s third-quarter results show a 23% drop in sales and revenue compared to the third quarter of 2019.
CAT leaders say that’s because demand is down for equipment and services.
Third quarter profit per share is now at $1.22. In the second quarter of this year, it was at .84 cents.
But the profit per share is down 54 % from last year’s third quarter $2.66.
But Zeigler says the pandemic makes it a challenge to compare numbers.
“I was happy to see that Caterpillar had exceeded most of the wall street expectations for the third quarter of this year however if you compare the numbers to the third quarter of last year, there’s a pretty drastic drop due to the whole coronavirus situation,” said Zeigler.
He says both Caterpillar’s earnings per share and revenue were higher than Wall Street analysts predicted.
“I think they’re a lot like other companies. Things were going well in the first quarter and then the coronavirus hit and essentially almost all business just stopped and it stopped for a good couple of months and we’re sort of just kind of slowly climbing back up that hill,” said Zeigler.
He said company leaders have a cautiously optimistic outlook.
“The message I took from all the Caterpillar numbers today was that they feel better this quarter than last quarter. I think when they report their fourth-quarter, earnings I hope that they’ll be feeling better than they were today,” said Zeigler.
He said CAT leaders did not give their typical fourth quarter forecast because of uncertainty surrounding the pandemic.
Fourth quarter earnings will be released in January.