The industrial stocks have seemingly failed to impress the markets with their Q2 earnings performance. The sector has seen mixed earnings from most of the top giants including General Electric Company (GE), Caterpillar Inc. (CAT), 3M Company (MMM), Union Pacific Corporation (NYSE: UNP) and Honeywell International Inc. (HON). Shares of most of these companies have dropped roughly 1% to 3% after their earnings announcement.
Industrials Earnings in Focus
General Electric
This largest industrial company in the U.S. set the trend this season for industrial companies reporting mixed results (read: Top ETF Picks for Q2 Earnings Season).
The conglomerate reported an 8.3% jump in its operating earnings to 39 cents a share, in line with the Zacks Consensus Estimate. Though revenues increased 3% year over year to $36.2 billion, it marginally fell short of the Zacks Consensus Estimate of $36.3 billion.
Though revenues from the company's Industrials segment remained strong, the company reported a year-over-year drop in revenues from the Capital segment. The company is realigning its corporate strategy to a manufacturing-based entity and intends to shrink its finance business by 2015 to reduce credit risks.
Moreover, during the quarter the company acquired Alstom's Power and Grid business to generate cost synergies, while it also plans to go for an IPO of its North American financial division, Synchrony Financial.
Nonetheless, poor performance from GE Capital failed to cheer investors as the segment's loan defaults are likely to be a drag on the company's profitability.
Caterpillar
Though heavy-equipment maker Caterpillar managed to beat our estimates on the earnings front, the company disappointed investors on revenues. Moreover, the company tightened the range of its revenue estimates to ...
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