Caterpillar Inc. (CAT.N) profit and sales beat estimates for the first quarter, driven by a boost in its mining business that may help ease investor concerns that trade tensions and signs of slowing global growth would be a drag on the heavy-equipment maker.
The mining and construction-equipment maker also boosted its per-share profit forecast for the year, crediting U.S. tax reforms.
-The results from Caterpillar, an economic bellwether, add to signs that industrial earnings are holding up in the face of the U.S.-China trade war and worries that some end users may be reaching the peaks in their growth cycles.
-The company is benefiting from rising capital investment in mining. That’s helping offset the impact of slowing economies that could cut into its construction and transportation businesses.
-Analysts including Courtney Yakavonis at Morgan Stanley say the need to replace aging mining equipment means orders are likely to kick into high gear.
-The stock rebounded in the first quarter after posting its worst annual loss in three years.
-The statement was released before the start of regular trading in New York, where Caterpillar shares climbed 1.3 per cent.