The end of an earnings season can be a great time to discover new stocks and assess how companies are handling the current business environment. Let’s take a look at how Caterpillar (NYSE:CAT) and the rest of the construction machinery stocks fared in Q1.

Automation that increases efficiencies and connected equipment that collects analyzable data have been trending, creating new sales opportunities for construction machinery companies. On the other hand, construction machinery companies are at the whim of economic cycles. Interest rates, for example, can greatly impact the commercial and residential construction that drives demand for these companies’ offerings.

The 4 construction machinery stocks we track reported a strong Q1. As a group, revenues missed analysts’ consensus estimates by 0.8%.

Thankfully, share prices of the companies have been resilient as they are up 5.7% on average since the latest earnings results.

Slowest Q1: Caterpillar (NYSE:CAT)

With its iconic yellow machinery working on construction sites, Caterpillar (NYSE:CAT) manufactures construction equipment like bulldozers, excavators, and parts and maintenance services.

Caterpillar reported revenues of $14.25 billion, down 9.8% year on year. This print fell short of analysts’ expectations by 2.6%. Overall, it was a softer quarter for the company with a miss of analysts’ adjusted operating income and EPS estimates.

"I'm proud of our global team's continued support of our customers and for delivering another quarter of solid results," said Chairman and CEO Jim Umpleby.Caterpillar Total Revenue

Caterpillar delivered the weakest performance against analyst estimates and slowest revenue growth of the whole group. Interestingly, the stock is up 4.3% since reporting and currently trades at $320.30.

Read our full report on Caterpillar here, it’s free.

Best Q1: Astec (NASDAQ:ASTE)

Inventing the first ever double-barrel hot-mix asphalt plant, Astec (NASDAQ:ASTE) provides machines and equipment for building roads, processing raw materials, and producing concrete.

Astec reported revenues of $329.4 million, up 6.5% year on year, outperforming analysts’ expectations by 2.8%. The business had a stunning quarter with a solid beat of analysts’ EPS estimates and an impressive beat of analysts’ EBITDA estimates.Astec Total Revenue

Astec delivered the biggest analyst estimates beat and fastest revenue growth among its peers. The market seems happy with the results as the stock is up 8% since reporting. It currently trades at $38.10.

Is now the time to buy Astec? Access our full analysis of the earnings results here, it’s free.

Story Continues

Terex (NYSE:TEX)

With humble beginnings as a dump truck company, Terex (NYSE:TEX) today manufactures lifting and material handling equipment designed to move and hoist heavy goods and materials.

Terex reported revenues of $1.23 billion, down 4.9% year on year, falling short of analysts’ expectations by 1.3%. Still, it was a satisfactory quarter as it posted a solid beat of analysts’ EBITDA estimates.

Interestingly, the stock is up 7.2% since the results and currently trades at $38.96.

Read our full analysis of Terex’s results here.

Manitowoc (NYSE:MTW)

Contracted by the United States Navy during WWII, Manitowoc (NYSE:MTW) provides cranes and lifting equipment.

Manitowoc reported revenues of $470.9 million, down 4.9% year on year. This number lagged analysts' expectations by 2.3%. Aside from that, it was a strong quarter as it logged a solid beat of analysts’ backlog and EBITDA estimates.

The stock is up 3.1% since reporting and currently trades at $8.56.

Read our full, actionable report on Manitowoc here, it’s free.

Market Update

The Fed’s interest rate hikes throughout 2022 and 2023 have successfully cooled post-pandemic inflation, bringing it closer to the 2% target. Inflationary pressures have eased without tipping the economy into a recession, suggesting a soft landing. This stability, paired with recent rate cuts (0.5% in September 2024 and 0.25% in November 2024), fueled a strong year for the stock market in 2024. The markets surged further after Donald Trump’s presidential victory in November, with major indices reaching record highs in the days following the election. Still, questions remain about the direction of economic policy, as potential tariffs and corporate tax changes add uncertainty for 2025.

Want to invest in winners with rock-solid fundamentals? Check out our Hidden Gem Stocks and add them to your watchlist. These companies are poised for growth regardless of the political or macroeconomic climate.

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