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The Zacks Analyst Blog Highlights: Caterpillar, Ford Motor, ArcelorMittal, Vale and BHP Billiton

  The Zacks Analyst Blog Highlights: Caterpillar, Ford Motor, ArcelorMittal,
                            Vale and BHP Billiton

PR Newswire

CHICAGO, April 11, 2013

CHICAGO, April 11, 2013 /PRNewswire/ --Zacks.com announces the list of stocks
featured in the Analyst Blog. Every day the Zacks Equity Research analysts
discuss the latest news and events impacting stocks and the financial markets.
Stocks recently featured in the blog include Caterpillar Inc. (NYSE:CAT), Ford
Motor Co. (NYSE:F), ArcelorMittal (NYSE:MT), Vale S.A. (NYSE:VALE) and BHP
Billiton Limited (NYSE:BHP).

(Logo: http://photos.prnewswire.com/prnh/20101027/ZIRLOGO)

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from the Pros newsletter: http://at.zacks.com/?id=5513

Here are highlights from Wednesday's Analyst Blog:

Layoffs Continue at Caterpillar

Owing to reduced global demand for mining equipment and to bring production in
line with demand, Caterpillar Inc. (NYSE:CAT) announced plans to lay off more
than 400 employees or about 11% of its work force at its Decatur, IL factory.

The Decatur plant manufactures mining equipment. Amid the growing concerns of
the sluggish pace of global economic recovery, Caterpillar temporarily
retrenched employees in October and shut down parts of its Decatur facility
for a week in November and entire month of December due to the fall in demand.
However, this time the layoffs are permanent.

This news comes on the back of another job cut by Caterpillar at its South
Milwaukee plant. Earlier, in March, the company announced job cuts at its
Belgium plant due to high costs and weak European economy, similar to the
strategy adopted by Ford Motor Co. (NYSE:F) and ArcelorMittal (NYSE:MT ) in
the region.

Caterpillar previously added production capacity for many of its products.
However, with the growing concerns and uncertainty about the pace of economic
growth, short-term economic risks in the U.S, the Eurozone debt crisis, and
the slowdown in China's growth, Caterpillar has now opted to be cautious
toward acquisitions and expansion investments. Mining companies such as Vale
S.A. (NYSE:VALE) and BHP Billiton Limited (NYSE:BHP) also have been revisiting
and trimming their capital expenditures plans following the slowdown in
economic expansion in China, the world's largest user of coal and metals.
Prices for coal and iron ore have dropped due to slowing growth in China and
European debt problems.

Caterpillar's results have borne the brunt of continued economic turmoil in
Europe and its domino effect on the rest of the world. Furthermore, reduced
sales, lower production and a decline in inventory primarily resulted in lower
fourth quarter 2012 earnings for Caterpillar. Caterpillar remains challenged
with slowing demand and inventory correction as a result of higher production
than demand.

The downslide in sales continued in 2013 as well with Caterpillar's worldwide
sales declining 13% for the three months ending Feb 2013, the third
consecutive month of declining sales. The growth rate has, in fact, worsened
from the 4% and 1% dip reported in Jan 2013 and Dec 2012, respectively.

The situation is not expected to improve in the first quarter of 2013 as
Caterpillar expects sales to be significantly lower on an annual basis as
dealers are anticipated to continue to lower their new machine inventories.
The company foresees earnings to be affected by lower-than-expected sales and
negative cost impact of continuing low production levels and declining
inventory. For fiscal 2013, sales are expected to be in the range of $60 to
$68 billion and earnings between $7.00 and $9.00.

Even though Caterpillar will benefit from the recovery in the U.S.
construction sector, the recent slowdown in sales, declining backlog, negative
impact of the European debt crisis and a slowing Chinese economy remain
concerns.

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