What Caterpillar's Earnings Are Telling Us About the Market: Profit Confidential Investigates

According to a recent article in Profit Confidential, Caterpillar Inc.'s fourth-quarter corporate earnings beat Wall Street's consensus, growing 60% to $1.55 billion on a 24% jump in sales. Caterpillar guided 2012 above current consensus.

New York, NY (prHWY.com) February 3, 2012 - According to a recent article in Profit Confidential, Caterpillar Inc.'s fourth-quarter corporate earnings beat Wall Street's consensus, growing 60% to $1.55 billion on a 24% jump in sales. Caterpillar guided 2012 above current consensus. Mitchell Clark, contributor to popular financial newsletter Profit Confidential, believes that the construction, mining and industrial manufacturer's earnings say a lot about the current market and economy.

"Probably as good a benchmark stock for the global economy as you can get is Caterpillar Inc.," highlights Clark. "If an economy is doing well, it's building new roads and buildings and that takes heavy equipment."

However, Clark points out that a lot of the great earnings from large-cap companies are due to their international operations generating the growth.

In addition, Clark is worried that corporate earnings might slow in the bottom half of this year, which would obviously be a negative for the economy. "Without growth in employment, U.S. incomes cannot grow and the consumer, Main Street economy will be stuck," says Clark.

The stock market has accommodative monetary policy, good corporate earnings, and a reasonable valuation to go on, according to Clark. He believes that what the market needs to take itself to the next level are better economic data.

"Cautious optimism is my outlook for the stock market right now," says Clark. "With the expectation for 10% growth in corporate earnings, there's no reason why the stock market can't accomplish a similar gain for the year or better."

Profit Confidential, which has been published for over a decade now, has been widely recognized as predicting five major economic events over the past 10 years. In 2002, Profit Confidential started advising its readers to buy gold-related investments when gold traded under $300 an ounce. In 2006, it "begged" its readers to get out of the housing market...before it plunged.

Profit Confidential was among the first (back in late 2006) to predict that the U.S. economy would be in a recession by late 2007. The daily e-letter correctly predicted the crash in the stock market of 2008 and early 2009. And Profit Confidential turned bullish on stocks in March of 2009 and rode the bear market rally from a Dow Jones Industrial Average of 6,440 on March 9, 2009, to 12,876 on May 2, 2011, a gain of 99%.

To see the full article and to learn more about Profit Confidential, visit www.profitconfidential.com.

Profit Confidential is Lombardi Publishing Corporation's free daily investment e-letter. Written by financial gurus with over 100 years of combined investing experience, Profit Confidential analyzes and comments on the actions of the stock market, precious metals, interest rates, real estate, and the economy. Lombardi Publishing Corporation, founded in 1986, now with over one million customers in 141 countries, is one of the largest consumer information publishers in the world. For more on Lombardi, and to get the popular Profit Confidential e-letter sent to you daily, visit www.profitconfidential.com.

Michael Lombardi, MBA, the lead Profit Confidential editorial contributor, has just released his most recent update of Critical Warning Number Six, a breakthrough video with Lombardi's current predictions for the U.S. economy, stock market, U.S. dollar, euro, interest rates and inflation. To see the video, visit http://www.profitconfidential.com/critical-warning-number-six

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Tag Words: stock market, global economy, current market, profit confidential, michael lombardi

Categories: Business

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