Caterpillar sinks on lowered forecast ... for 2015?September 25, 2012: 4:42 PM ET
In a world fraught with uncertainty and volatility, the executive team at Caterpillar (CAT) can evidently see the future -- three years into the future. The equipment maker slashed its revenue and profit forecasts for 2015. It cited the likelihood of "modest" economic growth at an industry conference this week.
Should growth fall farther than the company's modest predictions, Caterpillar's CEO Douglas Oberhelman promised that investors would still find reasons to love the company and its performance: "Caterpillar is ready to act if we enter a recession," said Oberhelman in a press release. "We don't think it's likely, but if it happens, we are prepared to react and would expect to remain attractively profitable and to maintain our dividend."
Caterpillar's stock slipped more than 4% Tuesday. Some traders on StockTwits traders expressed bemusement at the company's decision to project that far ahead.
The company's updated forecasts appeared to raise more questions than they answered.
Intel (INTC) and FedEx (FDX) cut guidance earlier this month. Lower projections from them, as well as Caterpillar, do paint a sad picture for future economic growth in Europe and the rest of the world.>
Well, stocks were down Tuesday afternoon. The Dow fell more than 100 points in large part due to Caterpillar's drop. Some investors even think Caterpillar's stock still has room to run.