With CAT and MCD accounting for over 100 of the 250+ Dow points yesterday, one would think that, as CNBC has repeatedly stated yesterday, these two companies are posting “tremendous earnings growth.”
And, in a way they are… a non-GAAP way. Because while CAT reported adjusted EPS of $1.28, up exactly 100% from a year ago- almost as if it was goal seeked – something far less appetizing emerges when looking at CAT’s actual, GAAP EPS, which happen to be exactly one-quarter of the non-GAAP number, or $0.32, a 30% drop from a year ago.
And another quick look at these “one-time restructuring costs”, which not only plague every single CAT earnings release but were enough to eliminate more than 100% of the company’s stated organic growth in the past year.
Finally, for those who – like CAT management – claim that the company’s adjustments are non-recurring and one-time, here is the chart that will show that when it comes to “one-time charges” for CAT recurring earnings are rarer than actual addbacks, highlighting just one fact:
In other words, CAT’s entire per share “profit” in the last 12 months was due to adding back some $4.32 in very much recurring restructuring charges.
