Earnings results often indicate what direction a company will take in the months ahead. With Q1 now behind us, let’s have a look at Lindsay (NYSE:LNN) and its peers.
Automation that increases efficiencies and connected equipment that collects analyzable data have been trending, creating new demand for heavy machinery and equipment companies. The gradual transition to clean energy also allows companies to innovate around emissions, potentially spurring replacement cycles that can accelerate revenue growth. On the other hand, heavy 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 7 heavy machinery stocks we track reported a strong Q1; on average, revenues were in line with analyst consensus estimates. Valuation multiples for many growth stocks have not yet reverted to their early 2021 highs, but the market was optimistic at the end of 2023 due to cooling inflation. The start of 2024 has been a different story as mixed signals have led to market volatility, and while some of the heavy machinery stocks have fared somewhat better than others, they collectively declined, with share prices falling 4.9% on average since the previous earnings results.
Weakest Q1: Lindsay (NYSE:LNN) A pioneer in the field of center pivot and lateral move irrigation, Lindsay (NYSE:LNN) provides a variety of proprietary water management and road infrastructure products and services.
Lindsay reported revenues of $151.5 million, down 8.9% year on year, falling short of analysts' expectations by 12.3%. It was a weak quarter for the company, with a miss of analysts' operating margin and earnings estimates.
“Demand for irrigation equipment in North America remained stable during our second quarter and in line with our expectations, supported by grower investment from the carryover impact of solid farm profits realized last year," said Randy Wood, President and Chief Executive Officer.
Lindsay delivered the weakest performance against analyst estimates of the whole group. The stock is down 0.7% since the results and currently trades at $114.44.
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Best Q1: 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 $1.29 billion, up 4.6% year on year, outperforming analysts' expectations by 5%. It was a stunning quarter for the company, with an impressive beat of analysts' organic revenue estimates.
Terex achieved the biggest analyst estimates beat among its peers. The stock is down 9.9% since the results and currently trades at $53.93.
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 $15.8 billion, down 0.4% year on year, falling short of analysts' expectations by 1.2%. It was an ok quarter for the company, with an impressive beat of analysts' operating margin estimates but a miss of analysts' organic revenue estimates.
The stock is down 9.1% since the results and currently trades at $330.46.
Greenbrier (NYSE:GBX) Having designed the industry’s first double-decker railcar in the 1980s, Greenbrier (NYSE:GBX) supplies the freight rail transportation industry with railcars and related services.
Greenbrier reported revenues of $862.7 million, down 23.1% year on year, surpassing analysts' expectations by 2.5%. It was a very strong quarter for the company, with an impressive beat of analysts' volume estimates and an impressive beat of analysts' earnings estimates.
Greenbrier had the slowest revenue growth among its peers. The stock is down 4.1% since the results and currently trades at $50.2.
PACCAR (NASDAQ:PCAR) Founded more than a century ago, PACCAR (NASDAQ:PCAC) designs and manufactures commercial trucks of various weights and sizes for the commercial trucking industry.
PACCAR reported revenues of $8.24 billion, up 2.3% year on year, in line with analysts' expectations. It was a very strong quarter for the company, with an impressive beat of analysts' organic revenue estimates and a solid beat of analysts' operating margin estimates.
The stock is down 5.8% since the results and currently trades at $107.01.
