CNH shares getting blasted on poor outlook
CNH — the merged construction/agricultural equipment giant perhaps better known as Case New Holland — disappointed the markets with its earnings outlook today. At one point shares were down 30 percent. Notably, CNH would not offer guidance for this quarter. Wall Street hates that.
CNH said it expected the weakness in construction equipment sales that dogged the industry in 2008 to continue into 2009 in all major markets, including “significant declines in Western European and Latin American markets.” It also warned that the many infrastructure investment projects being unveiled around the world to pull local economies out of recession would do little to increase demand for new equipment.
“Although unprecedented levels of governmental stimulus actions are being enacted throughout the world, we expect that such actions will have an impact in late 2009 or possibly into 2010, and may only serve as an offset to new declines in other construction equipment market segments,” CNH said in a statement.
As a result, the company said it planned to idle its construction equipment factories “for much of the first half of the year.”
Caterpillar, which reports earnings Monday, was down as much as 7 percent this morning.
[…] lousy earnings report rained redness on everybody in the construction sector Thursday. Caterpillar got spanked pretty […]
Permalink | Posted January 22nd, 2009, at 1:26 pm