PEORIA, Ill. (AP) Heavy-equipment maker Caterpillar Inc. said Nov. 3 it is targeting more than $50 billion in annual sales by 2010, up more than 20 percent from current levels, despite a weaker U.S. economy and slowing demand in key markets.
The company said 2007 sales are expected to be flat to slightly higher than this year’s total, reflecting weakened demand for its on-highway engines and a lackluster U.S. housing market.
It also said next year’s earnings growth will be the slowest in more than five years and could come in short of Wall Street’s expectations.
Caterpillar discussed its outlook in a presentation to analysts in Lafayette, Ind., a day after a regulatory filing in which it outlined its expectations for 2007.
It estimated next year’s sales to be in a range of $41 billion to $43 billion, compared with $41 billion expected this year. That would be on the high end of the range anticipated by analysts, whose consensus estimate based on a Thomson Financial survey was $41.23 billion for next year.
Caterpillar reiterated October’s estimate for 2006 earnings of $5.05 to $5.30 a share, and forecast 2007 earnings of $5.18 to $5.70 a share. Analysts were looking for $5.63 a share next year.
In the quarterly filing made Nov. 2, the company said it expects at least modest growth in 2007 despite the prospects of a slowing U.S. economy, a sharp drop in sales of on-highway truck engines and weaker housing construction.
“While next year will likely be a year of slower corporate growth, the fundamentals for key global industries we serve are strong, and after the 2007 pause we expect continued solid growth through the end of the decade,” Caterpillar said.
Shares in the company fell 13 cents to close at $60.43 on the New York Stock Exchange.