Zacks Industry Outlook Highlights: Deere & Co., Caterpillar, CNH Global, AGCO and Kubota

Zacks Industry Outlook Highlights: Deere & Co., Caterpillar, CNH Global, AGCO
                                  and Kubota

PR Newswire

CHICAGO, May 24, 2013

CHICAGO, May 24, 2013 /PRNewswire/ --Today, Zacks Equity Research discusses
the U.S. Machinery, including Deere & Company (NYSE:DE), Caterpillar Inc.
(NYSE:CAT), CNH Global NV (NYSE:CNH), AGCO Corporation (NYSE:AGCO) and Kubota
Corporation (NYSE:KUB).

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

A synopsis of today's Industry Outlook is presented below. The full article
can be read at 

Link: 
http://www.zacks.com/commentary/27432/machinery-industry-stock-outlook-may-2013

Recovery -- or the extent of recovery -- from the lows experienced since the
2008 global crisis is on everyone's mind today. Achievement on this front, as
witnessed from the equity market improvements, has been quite remarkable. But
can we say the global economy has rebounded completely to its pre-crisis
level?

Well, the pursuit is still on. The path to recovery has not been an easy one
with ever-present headwinds hindering growth, the most disconcerting of which
was the Eurozone debt crisis that significantly slowed down the overall growth
pace in 2011 and 2012.

According to the International Monetary Fund's (IMF) World Economic Outlook
published in Apr 2013, promising signs to growth are expected from the world's
emerging and developing nations, while advanced economies are expected to
exhibit slow but appreciable growth.

Projections by the IMF suggest that the world economy will likely grow by 3.3%
in 2013 and 4.0% in 2014. Growth in advanced economies and emerging and
developing countries are projected at 1.2% and 5.3% in 2013 while the same for
2014 are estimated at 2.2% and 5.7%, respectively.

No doubt obstacles still persist in the form of an unstable European economy
and slowly reviving advanced countries; nevertheless, the overall growth
picture may not materially deteriorate from the IMF's Apr 2013 forecast.

Regarding the Machinery industry, increasing economic activities spur demand
for industrial products, which in turn also boosts the need for new/advanced
machinery. Based on this direct correlation, anticipation of improvement in
global economic growth is a positive sign for the future prospects of the
machinery industry.

The major end-markets for the machinery industry include agriculture,
construction, mining and energy industries, among others. A brief discussion
providing a glimpse of the future prospects of the machinery industry in
different nations is provided below.

Machinery Industry Prospects in the U.S.

The IMF expects the United States to grow 1.9% in 2013 as against 2.1%
predicted earlier and roughly 3.0% expected in 2014. High unemployment still
seems to be a disturbing factor, though there is a glimmer of hope emanating
from evidence of strengthening demands in the housing as well as durable goods
markets. Conditions in the credit markets are also improving slowly.

The Machinery industry is one of the most attractive industries in the
country. Growth prospects for this industry can be deduced from the indicators
to the performances in the recent past. In the first quarter of 2013
(Jan-Mar), industrial production in the United States rose by an annual rate
of 5.0%, while the same in the month of April rose by 1.9% as compared with
the year-ago period. Manufacturing output grew 5.3% in the quarter.

According to the US Census Bureau report published in May 2013, machinery
shipments in the first quarter 2013 increased 6.0% year over year while new
machinery orders grew 3.6%. However, machinery order backlog at the end of the
quarter was down 12.5%. Shipments for construction and industrial machinery
rose by 40.0% and 18.2%, respectively, while that for mining equipment and
farm machinery dipped 3.7% and 8.0%, respectively.

Export demand has been considered crucial for the future growth prospects of
the U.S. machinery industry. According to a report published by the
Association of Equipment Manufacturers (AEM) in Feb 2013, the United States'
construction equipment exports rose 13% in year 2012, while agricultural
equipment exports registered a 16% increase.

For the years to come, international demand for technologically advanced
construction and agriculture equipment are expected to improve for the United
States. In this respect, it is worth mentioning that the US-Russia trade bill
will boost U.S. exports of construction equipment to Russia, the 11th-largest
export market for U.S. construction equipment.

Important Players of the Machinery Industry

Deere & Company's (NYSE:DE) fiscal second quarter 2013 (ended Apr 2013)
results were impressive. For the quarter, equipment sales rose roughly 9%,
with price realization contributing 3%. The agricultural and forestry
equipment provider is expanding globally to leverage benefits from the growing
global farm industry. For fiscal year 2013, equipment sales are expected to
grow 5% year over year and for the third quarter by 3%. Net earnings for 2013
are projected to be approximately $3.3 billion.

Caterpillar Inc. (NYSE:CAT) posted an 18% decline in Machinery and Power
Systems sales in the first quarter of 2013. For the year 2013, the company
expects revenue to range within the $57-$61 billion range as against $60-$68
billion expected earlier due primarily to the expectation of weak demand for
mining equipment.

Italy-based CNH Global NV (NYSE:CNH) posted a year-over-year increase of 1% or
3% on a constant currency basis in its equipment sales (agricultural and
construction) in the first quarter 2013.

Other top players in the agricultural, construction and mining industry
includes: AGCO Corporation (NYSE:AGCO) and Kubota Corporation (NYSE:KUB),
among others.

About Zacks

Zacks.com is a property of Zacks Investment Research, Inc., which was formed
in 1978 by Leonard Zacks. As a PhD from MIT Len knew he could find patterns in
stock market data that would lead to superior investment results. Amongst his
many accomplishments was the formation of his proprietary stock picking
system; the Zacks Rank, which continues to outperform the market by nearly a 3
to 1 margin. The best way to unlock the profitable stock recommendations and
market insights of Zacks Investment

Research is through our free daily email newsletter; Profit from the Pros. In
short, it's your steady flow of Profitable ideas GUARANTEED to be worth your
time! Register for your free subscription to Profit from the Pros at
http://at.zacks.com/?id=4581.

Visit http://www.zacks.com/performance for information about the performance
numbers displayed in this press release.

Follow us on Twitter: http://twitter.com/zacksresearch

Join us on Facebook: http://www.facebook.com/ZacksInvestmentResearch

Disclaimer: Past performance does not guarantee future results. Investors
should always research companies and securities before making any investments.
Nothing herein should be construed as an offer or solicitation to buy or sell
any security.

Media Contact
Zacks Investment Research
800-767-3771 ext. 9339
support@zacks.com
http://www.zacks.com

SOURCE Zacks Investment Research, Inc.

Website: http://www.zacks.com
 
Press spacebar to pause and continue. Press esc to stop.