Industrials

Caterpillar Is ‘Holding The Line’ On Earnings, Despite Macro Slowdown: Analyst Takeaways From Q2 Results

Caterpillar Inc. (NYSE:CAT) shares are climbing on Wednesday, after the company reported strong second-quarter results. The results came amid an exciting earnings season. Here are some key analyst takeaways. BofA Securities On Caterpillar Analyst Michael Feniger reiterated a Buy rating while reducing the price target from $385 to $376. Caterpillar reported better-than-expected second-quarter results, “demonstrating a higher/resilient EPS profile in a gloomy macro,” Feniger said in a note. Adjusted earnings came in at $5.99 per share, beating consensus estimates of $5.53 per share, he added. “While CAT is still a cyclical OEM, we are observing some quality attributes relative to other OEMs and prior slowdowns,” the analyst wrote. He further stated that Caterpillar was “holding the line” on earnings, despite a macro slowdown. Truist Securities On Caterpillar Analyst Jamie Cook maintained a Buy rating while raising the price target from $390 to $399. Caterpillar exceeded consensus earnings by 8% “on […]

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New Boeing CEO Faces Debt Challenge

Kelly Ortberg inherits a Boeing with $57.9 billion in debt and a credit rating hovering a notch above junk at one agency with negative watches at two others. April’s $10 billion bond issue at least bolstered a cash pile that had fallen into single-figure billions, but $4.2 billion of that was burned through in the latest quarter. With cash expected to be negative for the year, Ortberg and CFO Brian West may still have to return to the debt market to cover borrowings assumed from the planned takeover of Spirit AeroSystems.

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Boeing’s Stock up as Earnings Fall Short of Estimates as Company Sees Progress With Safety Plan

The Boeing Co.’s stock (BA) rose 2% early Wednesday, after the aerospace giant second-quarter earnings fell short of estimates, but the company said it’s making progress in beefing up its quality management system. The company had a net loss of $1.439 billion, or $2.33 a share, wider than the loss of $149 million, or 25 cents a share, posted in the year-earlier period. Adjusted for one-time items, the company’s loss per share came to $2.90, wider than the FactSet consensus for a loss of $1.90. Revenue fell 15% to $16.866 billion from $19.751 billion a year ago, also missing the $17.350 billion FactSet consensus. “Despite a challenging quarter, we are making substantial progress strengthening our quality management system and positioning our company for the future,” said CEO Dave Calhoun in prepared remarks. The company submitted its safety and quality plan to the Federal Aviation Administration during the quarter, while the

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Lockheed Martin Cash Boosted By F-35 Restart

Lockheed Martin will start delivering some of the dozens of parked F-35s after the Pentagon agrees to accept jets with an interim software fix that would allow them to be used for training. They won’t be combat ready until next year. Lockheed had expected to deliver between 75 and 110 F-35s this year — the last was in December — and dozens of jets worth more than $10 billion have been left in storage. Lockheed has said it expects to deliver 75-110 this year, unlocking final cash payments, with the Pentagon able to clear the backlog at a rate of 20 a month.

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Visa and Mastercard Shares Draw Downgrades as BofA Analyst Breaks From the Pack

BofA sees a potentially more volatile regulatory landscape as well as limited valuation upside Shares of Visa Inc. and Mastercard Inc. mostly draw buy ratings from Wall Street analysts. But BofA Global Research’s Jason Kupferberg broke from the pack on Wednesday as he downgraded both payment-technology stocks to neutral. He noted an “arguably … more volatile and unpredictable” regulatory landscape in the wake of a judge’s “unexpected” decision to reject the companies’ landmark deal in a long-running merchant suit. “Historically, we (and the investment community in general, based on investors with whom we’ve spoken) have largely treated [Visa and Mastercard] regulatory developments as no more than modest headline risk,” he wrote. But Visa and Mastercard now must contend with dynamics such as revising or going to trial over the merchant agreement and fending off the proposed Credit Card Competition Act with this new, unpredictable backdrop. Additionally, regulatory developments could make

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Visa, Mastercard Could Face Elevated Regulatory Activity, BofA Says

Visa (V) and Mastercard (MA) could face elevated regulatory activity that could limit multiple expansion, BofA Securities said in a Wednesday note as it downgraded the credit-card companies to neutral from buy. “Historically, we have largely treated [Visa and Mastercard] regulatory developments as no more than modest headline risk,” the firm said. “However, as the recent unexpected rejection of the proposed merchant litigation settlement illustrates, the regulatory environment has arguably become more volatile and unpredictable.” BofA said that some of the regulatory items to monitor include next steps in merchant litigation, the proposed Credit Card Competition Act and the Fed’s final decision on lower regulated debit interchange rates. The firm added that the two companies remain relatively “crowded” longs for long-only and hedge-fund investors. BofA said it continues to have a favorable view on the companies’ “premier business model and competitive moat.” Shares of Visa were down 1.5% and shares

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Boeing Reports June Deliveries Of 44 Commercial Jets Including 34 737 Max, For Highest Monthly Total In 2024

Boeing Reports June Deliveries Of 44 Commercial Jets Including 34 737 Max, For Highest Monthly Total In 2024; June Deliveries Of Five 777 Freighter Jets; Delivered 175 Airplanes During First Half Of 2024; Reports 14 Gross Aircraft Orders In June Including 3 For 737 Max; Had 2 Cancellations In June Including 1 Max And 1 Dreamliner; Reports 11 Orders In June For 777 Freighters; Boeing Reports 142 Gross Aircraft Orders Year To Date; Reports 115 Orders Net Of Cancellations/Conversions Year To Date

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Visa, Mastercard Extend Non-EU Swipe Fee Caps Until 2029

Visa (V) and Mastercard (MA) voluntarily agreed to extend maximum swipe fees on non-EU credit and debit card transactions in Europe until 2029, the European Union’s main antitrust regulator said Friday. Visa and Mastercard opted to continue to maintain a 0.2% fee cap on non-EU debit card payments and 0.3% on credit card payments within the 27-member states of the European Union, the European Commission said. For online or telephone transactions, the caps will remain at 1.15% for debit cards and 1.5% for credit cards, the European Commission

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FedEx Cost Cuts Are Delivering Results and Potential Freight Spinoff Is ‘Tantalizing’: Analysts

FedEx has placed its freight business under strategic review, the company said when it reported fiscal fourth-quarter results Tuesday FedEx Corp.’s ongoing cost-cutting efforts are delivering results, say analysts, who also welcome the package deliverer’s strategic review of its freight business. In its fiscal fourth-quarter results Tuesday, FedEx (FDX) said it expected improved demand for the coming fiscal year, sending its stock soaring 15% in premarket trading. It also said that it is conducting an assessment of FedEx Freight’s role in the company’s “value-creation plans” and that it plans to complete the review by the end of the calendar year. The company’s capital spending was $5.2 billion in fiscal 2024, down 16% from $6.2 billion in fiscal 2023. Related: FedEx rallies after big cost cuts, but one analyst wonders if the easy reductions are in the past TD Cowen raised its FedEx price target to $335 from $320 Wednesday, citing

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