CHICAGO, Sept. 10, 2014 /PRNewswire/ -- Today, Zacks Equity Research discusses the Machinery, including Lincoln Electric Holdings Inc. (Nasdaq:LECO-Free Report), Actuant Corporation (NYSE:ATU-Free Report), Stanley Black & Decker, Inc. (NYSE:SWK-Free Report), Kennametal Inc. (NYSE:KMT-Free Report) and Caterpillar Inc. (NYSE:CAT-Free Report).
Industry: Machinery
Link: http://www.zacks.com/commentary/34309/machinery-industry-global-perspective-bright-outlook
Let's take a look at the sector's performance in second-quarter 2014. Nearly 96% of the total Industrial Products companies in the S&P 500 group reported their results as of Aug 28. Earnings grew 3% year over year with a beat ratio (percentage of companies coming out with positive surprises) of 54.2%. Revenues declined 1.6% with a beat ratio of just 25%.
With demand in domestic and international markets picking up, improvements are anticipated in the sector. For the industrial sector, earnings growth is predicted at 7.8% in 2014 and 10.3% in 2015, to be driven by margin improvements. Revenue growth is likely to be 4% in 2014 and 3.6% in 2015.
In view of all the Zacks sectors combined, total earnings growth rate is predicted at 8.3% for 2014 and 12% for 2015. Revenue is anticipated to grow by 1.9% in 2014 and 4.2% in 2015.
Important Players in the Machinery Industry
Lincoln Electric Holdings Inc. (Nasdaq:LECO-Free Report): With a market capitalization of $5.7 billion, the company operates in the machine tools and related products industry. It specializes in manufacturing and selling welding and cutting products. An active acquisition program and development in manufacturing platforms will prove advantageous for future growth of the company.
Some other companies worth mentioning in the industry include Actuant Corporation (NYSE:ATU-Free Report), Stanley Black & Decker, Inc. (NYSE:SWK-Free Report) and Kennametal Inc. (NYSE:KMT-Free Report).
Caterpillar Inc. (NYSE:CAT-Free Report): The company operates in the construction and mining machinery industry with a current market capitalization of $68.2 billion. It is one of the leading manufacturers of construction and mining equipment, diesel and natural gas engines and industrial gas turbines. The company is well positioned to benefit from the recovery in the U.S. construction sector. Also, growing export demand in the country will bode well for the company going forward. Over the next five years, earnings are anticipated to grow 10.2%.
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