Jan. 23 (Bloomberg) — Caterpillar Inc., the world’s largest maker of construction equipment, may say profit fell again as sales slowed, a pattern that might extend into 2009 even if President Barack Obama’s $825 billion stimulus package is approved.

Caterpillar, the Peoria, Illinois-based builder of iconic mustard-hued earthmovers and excavators, may say Jan. 26 that fourth-quarter net income fell 18 percent to $804.3 million, the average estimate of seven analysts polled by Bloomberg. Sales probably rose 3.5 percent to $12.56 billion, the slowest growth rate in six years.

Caterpillar, Terex Corp., Joy Global Inc. and Deere & Co., which span the mining and agricultural machine industries, are among the major heavy-equipment makers whose profit and sales estimates have been cut by Bloomberg analysts from highs as recent as last fall. Those companies report earnings during the next two months.

“2009 is shaping up to be buck-naked ugly,” Sterne Agee & Leach Inc.’s Nicholas Heymann said in a Jan. 20 note to clients. Heymann, who has already projected that earnings for industrial companies would fall on average 20 percent to 30 percent this year, now expects earnings to fall as much as 40 percent. He said he might slash still further.

Results for heavy equipment makers may come under increasing pressure if Obama’s infrastructure package, which includes $44 billion for roads, bridges, rail and transport projects, isn’t approved before the President’s Day recess next month, said Heymann, a New York-based analyst who heads Sterne Agee’s infrastructure research.

Economic Growth Forecast

Caterpillar Chief Executive Officer Jim Owens, who holds a Ph.D. in economics from North Carolina State University, suggested he may update the company’s world economic growth forecast next week that he gave in October. Owens gave a tentative estimate of less than 2.5 percent world economic growth for 2009, according to the company’s third-quarter earnings release.

“The first two quarters are going to be rough,” said Bill Batcheller, who helps manage $650 million in assets, including Deere and Caterpillar shares, at Butler Wick & Co. in Youngstown,Ohio.

Caterpillar fell $1.57 or 4.2 percent, to $35.66 at 4:15 p.m. in composite trading on the New York Stock Exchange. The shares have fallen 45 percent in the last 12 months. Caterpillar declined to comment on its earnings.

Idled Factories

CNH Global NV, the Amsterdam-based maker of farm and construction machinery, said yesterday it would idle its construction equipment factories through most of the first half of the year in anticipation of slowing demand.

Government stimulus actions around the world, which wouldn’t have an impact until late 2009 at the earliest, “may only serve as an offset to new declines in other construction equipment market segments,” the company said in its fourth-quarter earnings statement.

CNH’s fourth-quarter construction equipment sales plunged 48 percent from a year earlier. Total sales, bolstered by higher horsepower agricultural equipment, fell 10 percent, the statement said. Net income before restructuring fell 2.5 percent.

Komatsu Ltd., the world’s second-biggest maker of earthmoving equipment, cut its profit forecast 42 percent in the year ending March 31, citing slowing demand from China and other emerging markets, the Tokyo-based company said today.

‘Likely to Worsen’

“Current conditions are likely to worsen before they get better,” Larry de Maria, a New York-based analyst with Sterne Agee in New York, wrote in a note after visiting a Komatsu and a Caterpillar dealership in New Jersey yesterday.

“Both companies are currently experiencing weak demand for all construction equipment,” de Maria wrote in his note today. The dealers account for half the New Jersey construction equipment market, he said.

Terex, the third-largest manufacturer of construction equipment, may report next month that net income fell 56 percent to $77 million. It would be the second straight quarterly profit decline for Terex.

Terex Sales

Sales probably fell 9 percent to $2.36 billion, according to the average estimate of 10 analysts surveyed by Bloomberg. It would be the first time sales have dropped in seven years.

With 70 percent of its sales outside of North America, Terex may benefit as emerging markets rebound in 2010, spurring demand for Western equipment, de Maria said in a Jan. 8 note to clients.

Westport, Connecticut-based Terex makes cranes, excavators, aerial work platforms, backhoe loaders and scrapers, among other things. It trails Caterpillar and Komatsu in construction equipment sales.

Joy Global Inc., the Milwaukee-based maker of mining equipment, is expected to buck the trend of declining profits and slowing sales growth among equipment makers with its first- quarter earnings report in March. Sales are expected to rise 25 percent to $798.6 million, and net income may jump 18 percent to $83.5 billion, according to the average of seven analysts’ estimates in a Bloomberg survey.

Joy Global’s sales and profit will likely be buoyed in part by its $270 million acquisition last year of Continental Global Inc., a maker of conveyer systems used to transport coal.

Deere, the world’s largest maker of farming equipment, will post fiscal first-quarter results next month. Analysts estimate net income will plunge 24 percent to $281.2 million, and sales will drop 2.9 percent. Lower commodity prices and declining U.S. farm income may depress results.

Terex, Joy Global and Deere all declined to comment on their earnings.

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