Ahead of the Bell: Caterpillar
NEW YORK (AP) — A Susquehanna analyst on Tuesday cut his price target and earnings estimates for Caterpillar Inc., saying it's still unclear exactly how much mining equipment demand could fall.
Ted Grace backed his "Positive" rating, but cut his price target by $9 to $109 and reduced his earnings-per-share predictions for 2013 and 2014 by 7 percent each to $7.45 and $8.40, respectively.
Analysts, on average, expect a 2013 profit of $8.04 per share and a 2014 profit of $9.46 per share, according to FactSet.
Grace said that while the company's stock price is approaching levels that make it a favorable investment, he doesn't expect the shares to post much in the way of gains until it becomes clear exactly how much capital spending on mining will fall.
Mining companies have struggled in recent years as a tough economic conditions and have been forced to cut back spending. Coal mining companies have been hit particularly hard as utilities have increasingly shifted toward natural gas.
Caterpillar shares rose 35 cents to $86.99 in premarket trading.