Industrials Weekly Review: Caterpillar, 3M and Honeywell
During the past week, Caterpillar (NYSE: CAT), discussed the impact of the oil price decline on the company. The company also celebrated its 85th year on the New York Stock Exchange. 3M’s (NYSE: MMM) stock price reached a new 52-week high on last week’s momentum. Honeywell (NYSE: HON) launched a new data analytics software for the oil and gas industry. Below we give a quick rundown on the most notable events in the last week related to the companies.
Caterpillar
Caterpillar celebrated its 85th year of listing on the New York Stock Exchange on December 22th. [1] Doug Oberhelman, Chairman and CEO, rang the opening bell on the day. He spoke about the company’s strong balance sheet and cash flow position that has allowed them to return $5.8 billion to shareholders in the form of repurchases and dividends in 2014.
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On the same day, Doug Oberhelman, at an interview with CNBC, was discussing the impact of the decline in oil price on Caterpillar. [2] He pointed out that the decline will surely have an impact on the company but is unlikely to be as major as the slump in mining equipment sales. Also, the company’s operating expenses are likely to benefit from the decline in oil price.
Caterpillar’s stock gained more than 2% over the week through Wednesday. We currently have a price estimate of $110 for Caterpillar, around 17% higher than its current market price. We estimate revenues of $55.9 billion, compared to consensus estimates of $55 billion, and EPS of $6.43 for this year, compared to consensus estimates of $6.56.
Click here to see our complete analysis of Caterpillar
3M
3M’s stock price hit a new 52-week high on December 23, opening at $168.16. [3] The stock had been moving upwards since the company’s 2015 outlook meeting, during which it had announced a 20% increase in dividend. [4] However, the stock declined through the day to end at $166.87 as investors began to cash in on the 52-week high price.
3M’s stock gained less than 1% over the week through Wednesday. We currently have a price estimate of $142 for 3M, approximately 15% lower than its current market price. We estimate revenues of $32 billion and EPS of $7.39 for this fiscal year, slightly below consensus estimates.
Click here to see our complete analysis of 3M
Honeywell International
Honeywell launched a data analytics tool for the upstream oil and gas industry that will help boost production and improve safety. [5] Honeywell claims that the software can improve production performance by 3-5%.
Honeywell’s stock gained less than 1% over the week through Wednesday. We currently have a price estimate of $106 for Honeywell, around 4% higher than its current market price. We estimate revenues of $40.3 billion and EPS of $5.56 for this year, about in line with consensus estimates.
Click here to see our complete analysis of Honeywell
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- Caterpillar Celebrates 85 Years on the New York Stock Exchange, December 22, 2014, www.caterpillar.com [↩]
- CAT CEO: We’ll see impact from oil no question, December 22, 2014, www.cnbc.com [↩]
- 3M Historical Price, www.yahoo.com [↩]
- 3M Increases Dividend 20 Percent , December 16, 2014, www.3m.com [↩]
- Honeywell launches data analytics tool for upstream business, December 24, 2014, www.oilreviewmiddleeast.com [↩]