2023 Capital Goods Dealership Global Outlook: Energy Transition is Helping Issuers Stay Resilient
Welcome to 2023: this is the year that is unlikely to be feared by capital goods dealers thanks to energy transition and, in part, to a lingering pandemic aftermath. Overall, DBRS Morningstar's outlook for capital goods dealership issuers is neutral. Despite the strong order backlog, there are many moving variables that are at play and need to be monitored closely. While we anticipate challenging times ahead in the context of a projected macroeconomic slowdown, 2023 presents a unique opportunity for many capital goods dealership issuers to show resiliency through cost management and capital discipline as they capitalize on energy transition trends supporting increased demand for equipment and services in the coming year.Caterpillar is a manufacturer of construction and mining equipment, diesel and natural gas engines, industrial gas turbines and diesel-electric locomotives. The company segments include: Construction Industries, which supports customers using machinery in infrastructure, forestry and building construction; Resource Industries, which supports customers using machinery in mining, heavy construction, quarry and aggregates, waste and material handling applications; Energy and Transportation, which supports customers in oil and gas, power generation, marine, rail and industrial applications, including Cat? machines; and Financial Products, which provides financing and related services.
Toromont Industries delivers capital equipment to a range of customers and industries. Co. operates through two business segments: the Equipment Group and CIMCO. Through its Equipment Group, Co. is engaged in the supply of mobile equipment and industrial engines and provides sales and rental solutions as well as product support through Toromont Cat, Battlefield – The Cat Rental Store and SITECH Mid-Canada Ltd. in Ontario, Newfoundland, Manitoba and most of Labrador and Nunavut, and AgWest Ltd. in Manitoba. Through CIMCO, Co. is engaged in the design, engineering, fabrication and installation of industrial and recreational refrigeration systems with operations in Canada and the U.S..
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