What Happened?

Shares of construction equipment company Caterpillar (NYSE:CAT) fell 5.9% in the pre-market session after the company reported weak fourth-quarter results: Its revenue missed, and its EBITDA also fell short of Wall Street's estimates. Management said that "lower sales volume was primarily driven by lower sales of equipment to end users." Overall, this quarter could have been better.

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What The Market Is Telling Us

Caterpillar’s shares are not very volatile and have only had 3 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful, although it might not be something that would fundamentally change its perception of the business.

Caterpillar is up 4.3% since the beginning of the year, but at $375.37 per share, it is still trading 10% below its 52-week high of $416.88 from November 2024. Investors who bought $1,000 worth of Caterpillar’s shares 5 years ago would now be looking at an investment worth $2,773.

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