Monday, September 18, 2017

How Caterpillar Makes Money?

Analyzing how Caterpillar Inc. (NYSE:CAT) makes money is a useful exercise for investors because it sheds light on what investors need to know before buying the stock right now. In a nutshell, the stock's near-40% rise in the past year has been propelled by its positive earnings momentum, which is largely due to an improvement in its end markets. So in order to take a view on whether this can continue, it's useful to know how Caterpillar makes money

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Friday, September 15, 2017

3M Company Earnings Analysis

3M Company (NYSE:MMM) needs sales growth. Just like peer Illinois Tool Works (NYSE:ITW), its stock price is starting to look heady -- both companies are trading in excess of their pre-recession valuations -- and it needs growth now in order to justify its rating. Moreover, with 3M's CFO Nick Gangestad claiming dividend growth would "be very similar to what we anticipate for earnings-per-share growth," 3M needs sales and earnings growth in the future -- a near 2.2% dividend yield isn't particularly exciting. Can 3M Company increase its growth rate? 

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What General Electric Company Needs to Learn From Honeywell International

A quick look at the relative stock price performances of Honeywell International (NYSE:HON)and General Electric Company (NYSE:GE) in 2017 shows a nearly 40% outperformance by the former. How is this so? Both companies are diversified industrial conglomerates with many end markets in common, particularly aerospace, so their stock prices should be roughly correlated, right?

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Tuesday, August 29, 2017

United Technologies Earnings Analysis

On the whole, United Technologies Corporation's (NYSE:UTX) earnings were a net positive, but they still left investors with plenty of answered questions. Although management raised full-year sales and earnings guidance, the reasons behind it --strengthening end markets -- was largely anticipated following earlier results from companies such as Honeywell International(NYSE:HON). It's the company-specific commentary that may have left investors concerned.

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Jones Lang LaSalle Earnings Analysis

Commercial property services company Jones Lang LaSalle (NYSE:JLL) strategic growth plan remains on track, but you wouldn't think it from looking at its declining EBITDA in the first half of the year. No matter, it's all part of the company's acquisition-led expansion plans, which management hopes will generate strong earnings growth in the years to come. The second-quarter earnings saw the company aggressively growing its top line while generating what management called "underlying operating momentum."

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Emerson Electric Earnings Analysis

It's been a long time coming, but Emerson Electric Co. (NYSE:EMR) is finally growing again. For the first time since the second quarter of 2015, the company's underlying sales were in positive territory. Moreover, Emerson's results were pretty much in line with expectations, but improving trends encouraged management to raise full-year guidance as a consequence.
Let's look at the details behind a busy third quarter for the company

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Tuesday, August 22, 2017

Roper Technologies Earnings Analysis

Diversified industrial company Roper Technologies, Inc. (NYSE:ROP) reported a solid set of second-quarter results, which contained the usual hallmarks of a Roper earnings report. Revenue and core operating margin expanded in all four segments, and the company's asset-light business model helped to ensure strong ongoing free cash flow generation.
Meanwhile, Roper's acquisitions are settling in well, and the company's transition to more software-based revenue continues. Let's take a look at the report.

Cognex Corporation Earnings Analysis

Machine vision company Cognex Corporation (NASDAQ:CGNX) reported record results in its second quarter and promptly guided investors toward a "monster" third quarter.
There are a lot of good things going on with the company in 2017, and the earnings call hinted at more long-term growth, even if the third quarter is likely to prove somewhat of an outlier. Let's take a look at another strong quarter for the company.
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Wednesday, August 16, 2017

Robert Half International Earnings Analysis

Leading staffing company Robert Half International Inc. (NYSE:RHI) delivered a solid set of results in its latest earnings report, and its numbers imply a relative improvement in the U.S. employment market. Moreover, management highlighted a leading indicator that suggests conditions will improve in the coming quarters.
Let's look at the results from one of the best bellwethers of the U.S. economy.

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BorgWarner Earnings Analysis

According to BorgWarner Inc. (NYSE:BWA) management, the outlook for the auto industry worsened in the past few months. But you wouldn't know it from the company's second-quarter results released on Thursday. BorgWarner is outperforming its end markets, and to such an extent that management felt compelled to raise full-year sales and earnings guidance.
Let's take a look at a strong quarter for the engine and drivetrain company.

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WESCO International Earnings Analysis

Not all industrial recoveries are equal. That's the message in the second-quarter earnings report from supply chain solutions provider WESCO International, Inc. (NYSE:WCC). Aside from construction, the company's end markets are improving, but the lackluster nature of the recovery has led to pressure, and management cut its full-year expectations for margin and earnings. Let's take a look at the mixed earnings report.

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Saturday, August 12, 2017

Dassault Systemes Earnings Analysis

It's not often that long-term considerations overshadow current trading matters on an earnings call, but that was the case with engineering design software company Dassault Systemes(NASDAQOTH:DASTY). In a nutshell, the company is on track with its objectives in 2017, but the announcement of Boeing's (NYSE:BA) decision to adopt Dassault's 3DExperience platform across its commercial aviation, space, and defense work grabbed the attention of investors. Let's take a look at the earnings report and the the Boeing announcement in more detail.

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Illinois Tool Works Earnings Analysis

Multi-industrial company Illinois Tool Works (NYSE:ITW) delivered another good quarter of earnings and raised full-year guidance across the board. It was a positive quarter for the company, driven by its automotive segment and recovery in some of its more cyclical segments (specifically welding, test and measurement, and electronics). That said, management served notice of a relative slowdown in the third quarter. Let's take a look at a busy second quarter for the company.

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Thursday, August 10, 2017

General Electric's Earnings Fail

A quick look at the headline guidance from General Electric Company (NYSE:GE) would conclude that everything is on track in 2017, as the guidance ranges were exactly the same as those given in the first-quarter earnings presentation. However, the devil is in the details, and the reality is that this was a disappointing set of earnings, as Jeff Immelt signed off his tenure as CEO by guiding investors toward the low end of expectations. Moreover, the tone and commentary suggested more difficulties to come, and it wouldn't be surprising if new CEO John Flannery begins his tenure by cutting guidance.
Let's take a closer look a difficult quarter for the company.

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Honeywell International Guidance Looks Conservative

Honeywell International's  second-quarter results created a sense of déjà vu, leaving some analysts feeling that management was being conservative with regard to its outlook. Earnings of $1.80 came in at the high-end of management's guidance, and organic sales growth of 3% was significantly above the guidance range of 0%-2%. However, management merely raised the bottom end of its full-year guidance to $7-$7.10 from a previous range of $6.90-$7.10. Is Honeywell's management being too cautious with guidance?

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Danaher Corp Earnings Analysis

Danaher Corporation's (NYSE:DHR) second-quarter results were almost an investing trivia question: Which company beat earnings expectations and raised full-year guidance, but still managed to disappoint investors? The answer: Danaher. Its earnings were good, but the company is tracking behind its full-year revenue guidance, and there are question marks on its dental segment. Is Danaher still worth investing in?

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Sunday, August 6, 2017

Caterpillar Investors Should be Prepared For This

Deciding whether to buy or sell stock in Caterpillar Inc. (NYSE:CAT) raises one of the great investing conundrums: what to do with a stock that has strong earnings momentum, but whose current valuation is starting to look high on a historical basis. Let's take a look at the investment case for buying the stock and why the valuation should be giving investors cause for concern.

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Wednesday, August 2, 2017

Check Point Software Earnings Review

After an uncertain outlook for the industry at the start of the year, it's turned out to be a pretty good year for network cybersecurity companies, and the latest results from Israeli company Check Point Software Technologies Ltd. (NASDAQ:CHKP) this week confirmed an industry in good shape. That said, there were a couple of points that might have left investors concerned. Let's take a look at them in the context of a broadly positive set of second-quarter earnings.

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A Few Things You Didn't Know About FedEx Corporation


It's easy to quickly conclude that FedEx Corporation (NYSE:FDX) is just a smaller version of United Parcel Service (NYSE:UPS) and that the two companies are essentially interchangeable, except for FedEx's greater emphasis on express deliveries. However, a closer look at the facts reveals some key differences. Here's a look at some things that might make you think differently about FedEx.

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GE Earnings Review

The upcoming second-quarter earnings report from General Electric Company (NYSE:GE) will have investors eagerly looking for clues of any changes in strategic direction. However, the first thing management needs to do is reassure investors it's on track with its medium-term objectives. Keeping with that line of thought, let's look at three things investors need to hear from GE's management.

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