Ahead Of The Bell: Heavy Machinery Makers

NEW YORK (AP) — Heavy machinery makers rose in premarket trading Friday after an analyst upgraded shares of several major manufacturers on expectations of strong earnings and a view that a recent stock sell-off was excessive.

Credit Suisse analyst Jamie Cook upgraded shares of Peoria, Ill.-based Caterpillar Inc., Cleveland-based Parker-Hannifin Corp. and Westport, Conn.-based Terex Corp. to "Outperform" from "Neutral."

"The degree to which the stocks sold off during the current downturn was likely excessive," Cook said.

The analyst further said "most companies in the sector should beat consensus expectations based on cost controls and benefits from aggressive restructuring."

Cook also wrote in an analyst note that heavy machinery makers should get a lift from the reviving economy that last through next year.

"With the recent rise in new orders, U.S. industrial production should increase in the near-term providing support for higher volumes. The rebound in Europe is still in its infancy stages, thus providing a possible tailwind in late (2010)."

In premarket trading, share of Caterpillar rose 15 cents to $52, Parker-Hannifin climbed 48 cents to $52.72 and Terex added 29 cents to $19.65.