Caterpillar (CAT), Joy Global (JOY) Hit as BHP Pulls Back on Capex Plans
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Price: $86.21 -0.85%
Overall Analyst Rating:
BUY (= Flat)
Dividend Yield: 2.6%
Revenue Growth %: -17.4%
Overall Analyst Rating:
BUY (= Flat)
Dividend Yield: 2.6%
Revenue Growth %: -17.4%
Trade CAT Now!
Caterpillar Inc. (NYSE: CAT) and other mining equipment companies are lower early Wednesday following news from mining giant BHP (NYSE: BHP) that it is shelving expansion plans.
With 20 major projects currently in execution with a combined budget of US$22.8 billion, BHP Billiton said it is largely committed for the 2013 financial year. No major project approvals are expected over this timeframe, the company said.
Commenting on the delay of the massive Olympic Dam expansion, the company said:
"BHP Billiton announced today that it will investigate an alternative, less capital-intensive design of the Olympic Dam open-pit expansion, involving new technologies, to substantially improve the economics of the project. As a result it will not be ready to approve an expansion of Olympic Dam before the Indenture agreement deadline of 15 December 2012. The Company will discuss the implications of this decision for the Indenture agreement with the South Australian Government in the coming months."
In addition to a 2.3% slide in CAT, Joy Global, Inc. (NYSE: JOY) is down 1.8%.
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With 20 major projects currently in execution with a combined budget of US$22.8 billion, BHP Billiton said it is largely committed for the 2013 financial year. No major project approvals are expected over this timeframe, the company said.
Commenting on the delay of the massive Olympic Dam expansion, the company said:
"BHP Billiton announced today that it will investigate an alternative, less capital-intensive design of the Olympic Dam open-pit expansion, involving new technologies, to substantially improve the economics of the project. As a result it will not be ready to approve an expansion of Olympic Dam before the Indenture agreement deadline of 15 December 2012. The Company will discuss the implications of this decision for the Indenture agreement with the South Australian Government in the coming months."
In addition to a 2.3% slide in CAT, Joy Global, Inc. (NYSE: JOY) is down 1.8%.
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