Similarly to my previous post on Caterpillar, I cannot spot any positives in its results, which could support a bullish thesis on the precious metals sector.
Revenues and operating profit, delivered by Caterpillar's Resource Segment, were really bad in 1Q 2016:
source: Simple Digressions
As the chart shows, in 1Q 2016 revenue fell once again and was 26.5% lower than in 1Q 2015.
What is more, this fall was caused mainly by a $463 million decrease in the company's sales:
source: Caterpillar
Operating profit was following revenue:
Well, Caterpillar's performance is definitely not supportive for the gold bulls...
Don't bull markets in commodities begin after there has been a prolonged decrease in mining activity. Caterpillar's results are to be expected at this time. It will take a year or two of gold going up before we see increase mining activity.
ReplyDeleteA case for bull market is made when fundamentals look most depressing For all we know this could be a turn of fortune for Caterpillar revenues going forward
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