This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
TheStreet Open House

Caterpillar 4Q Profit Rises, Tops Wall St. View

BREE FOWLER

NEW YORK (AP) â¿¿ Caterpillar Inc. said Thursday that its fourth-quarter profit jumped 60 percent, boosted by pent-up demand for new equipment and continuing growth in developing countries.

The performance of the world's largest maker of construction and mining equipment is an indicator of the strength of the global economy. Along with strong fourth-quarter earnings, Caterpillar issued rosy guidance, saying that it expects the global economy to grow faster this year and construction activity to continue to improve in most parts of the world.

Caterpillar, based in Peoria, Ill., reported net income of $1.55 billion, or $2.32 per share, up from $968 million, or $1.47 per share, in the same quarter last year.

Sales and revenue jumped 35 percent to $17.24 billion, as sales volume increased at all three of the company's major businesses. Revenue from mining equipment company Bucyrus International Inc., which Caterpillar acquired in July, totaled $1.39 billion.

Caterpillar's results easily topped Wall Street predictions for profit of $1.76 per share and $15.95 billion in revenue, according to FactSet. That sent its shares higher and made it one of the biggest gainers in the Dow Jones industrial average on Thursday. The stock rose $2.26, or 2.1 percent, to close at $111.31, after hitting $114 earlier in the day, within a few dollars of its 52-week high of $116.55.

Caterpillar said that despite the ongoing downturn in the construction industry, many of its customers had to replace their aging equipment during the quarter. In addition, the company continued to get a boost from rapid economic growth in developing parts of the world.

Construction sales rose 31 percent to $5.26 billion, while resource industries sales, which include Bucyrus, jumped 80 percent to $5.06 billion. Sales of power systems were up 22 percent to $5.67 billion.

Caterpillar expects the global economy to grow about 3.3 percent this year, with the U.S. economy expanding by at least 3 percent. In addition U.S. construction spending, which has been declining since 2004, should finally begin to recover, the company said.

1 of 3

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
DOW 17,131.97 +100.83 0.59%
S&P 500 1,998.98 +14.85 0.75%
NASDAQ 4,552.7590 +33.8570 0.75%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs