Caterpillar, Boeing Hold Back Dow Despite Home Depot Gains

Don't let it get away!

Keep track of the stocks that matter to you.

Help yourself with the Fool's FREE and easy new watchlist service today.

The Dow Jones Industrials (DJINDICES: ^DJI  ) inched back into positive territory after opening the morning lower, up nearly two points as of 11 a.m. EST. Even though Home Depot (NYSE: HD  ) posted strong results in its fourth-quarter earnings report to lead all Dow gainers, downward pressure from Boeing (NYSE: BA  ) and Caterpillar (NYSE: CAT  ) helped keep the blue-chip index from a larger earnings-led lift.

Home Depot's results confirmed the relative strength of the home improvement retail industry, with earnings that beat expectations. Revenue dropped 3% from the year-ago quarter, but that was largely due to a quirk of the calendar that meant there was one less week during the quarter than there was for the same period in 2012. Investors were willing to shrug off 2014 guidance that didn't quite match up to hopes, with Home Depot expecting 4.8% higher sales and giving an earnings projection that was about 1% lower than analysts forecast. Nevertheless, the big question facing Home Depot going forward is whether winter weather will give way to a strong spring season, or if the economic malaise from the harsh winter will continue into the rest of 2014.

Meanwhile, Boeing fell almost 1%. The company got good news from the Pentagon yesterday, with Defense Secretary Chuck Hagel saying he would prefer to stick with a new air-refueling tanker program that Boeing is building. Today, however, there were reports that the company is having trouble selling unfinished early versions of its 787 Dreamliner aircraft, with customers preferring newer versions that are lighter and have a longer range. The issue shows the danger of long delays between taking orders and producing aircraft, as customers won't be happy receiving older models when new and better planes are available.

Similarly, Caterpillar fell almost 1.2%. The company has had an impressive run in 2014, as value investors bet on a turnaround in the construction industry that could lead to more sales of heavy equipment. Yet Home Depot's mixed guidance points to potential struggles in residential construction, and investors likely extended that outlook to commercial construction as well. With Caterpillar desperately needing a cyclical upturn, it's unclear whether shareholders will see the stock sustain its gains if conditions don't improve soon.

Don't settle for less than the best
Rising stocks are good, but there's a huge difference between a good stock and a stock that can make you rich. The Motley Fool's chief investment officer has selected his No. 1 stock for 2014, and it's one of those stocks that could make you rich. You can find out which stock it is in the special free report "The Motley Fool's Top Stock for 2014." Just click here to access the report and find out the name of this under-the-radar company.

Read/Post Comments (0) | Recommend This Article (0)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

Be the first one to comment on this article.

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 2853076, ~/Articles/ArticleHandler.aspx, 8/30/2015 11:06:11 PM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...

Dan Caplinger

Dan Caplinger has been a contract writer for the Motley Fool since 2006. As the Fool's Director of Investment Planning, Dan oversees much of the personal-finance and investment-planning content published daily on With a background as an estate-planning attorney and independent financial consultant, Dan's articles are based on more than 20 years of experience from all angles of the financial world.

Today's Market

updated 2 days ago Sponsored by:
DOW 16,643.01 -11.76 -0.07%
S&P 500 1,988.87 1.21 0.06%
NASD 4,828.33 15.62 0.32%

Create My Watchlist

Go to My Watchlist

You don't seem to be following any stocks yet!

Better investing starts with a watchlist. Now you can create a personalized watchlist and get immediate access to the personalized information you need to make successful investing decisions.

Data delayed up to 5 minutes

Related Tickers

8/28/2015 4:55 PM
^DJI $16643.01 Down -11.76 -0.07%
BA $133.24 Up +1.37 +1.04%
The Boeing Company CAPS Rating: ****
CAT $75.95 Up +0.29 +0.38%
Caterpillar, Inc. CAPS Rating: ***
HD $117.52 Down -0.14 -0.12%
Home Depot CAPS Rating: ****