What's happening with Caterpillar's stock price?
Why Caterpillar Stock Soared in March. Shares in construction, mining, transportation, and energy equipment company Caterpillar (NYSE: CAT) soared 18.8% in March, according to …
Why did Caterpillar stock take a dive Friday?
CAT | Complete Caterpillar Inc. stock news by MarketWatch. View real-time stock prices and stock quotes for a full financial overview.
How much did Caterpillar spend on share repurchases in 2020?
Jun 14, 2021 · Caterpillar’s revenues have trended lower, declining 24% to $41.7 billion in 2020, compared to $54.7 billion in 2018, primarily due to the impact of the Covid-19 pandemic on the demand for its...
Should investors be worried about caterpillar's key end market?
Sep 19, 2014 · Sep 19, 2014 2:51 PM EDT. Caterpillar (CAT) stock is lower after the company said its sales for the three month period that ended in August declined by 10% from the same period the previous year.
Why are Caterpillar stocks going down?
Caterpillar Stock Falls As Traders Focus On Rising Costs The company reported revenue of $13.8 billion and adjusted earnings of $2.69 per share, beating analyst estimates on both earnings and revenue. While the headline numbers were strong, the market focused on cost headwinds which put pressure on margins.Jan 28, 2022
Why did CAT go down today?
There are probably three key reasons: Rising raw material prices have pressured margins at machinery manufacturers, and Caterpillar and others are seeing rising costs. China's growth appears to be slowing, and this has caused fears that it might be time to bail out of cyclically exposed stocks like Caterpillar.Aug 11, 2021
Is Caterpillar a buy right now?
Zacks' proprietary data indicates that Caterpillar Inc. is currently rated as a Zacks Rank 2 and we are expecting an above average return from the CAT shares relative to the market in the next few months.
Is CAT overvalued?
Summary. CAT' has a weak valuation at its current share price on account of a overvalued PEG ratio despite strong growth. CAT's PE and PEG are worse than the market average leading to a below average valuation score.Mar 25, 2022
Why did Caterpillar stock go up?
Caterpillar stock was soaring after catching an upgrade Tuesday. Russia—and the widespread implications of its Ukraine invasion—is the reason. Jefferies analyst Stephen Volkmann upgraded Caterpillar (ticker: CAT) stock to Buy from Hold. His price target goes to $260 a share, up from $215.Mar 8, 2022
How is Caterpillar doing financially?
Full-year sales and revenues in 2021 were $51.0 billion, up 22% compared with $41.7 billion in 2020. The increase reflected higher end-user demand for equipment and services and the impact from changes in dealer inventories. Dealers decreased their inventories $2.9 billion in 2020, while remaining about flat in 2021.Jan 28, 2022
Is Caterpillar good stock to buy?
Caterpillar's industry sector, Construction and Mining, ranks in the top 40% in Zacks' Industry Rank. Zacks ranks Caterpillar itself as a number 3, for “hold,” over the next one to three months. A 3 rating correlates with a 10.62% annualized return prediction.Feb 11, 2022
Will Caterpillar stock increase?
While these headwinds may impact Caterpillar's earnings growth in Q4, looking forward, for the full-year 2022, we do expect the adjusted EPS to be higher at $12.25, compared to $8.74 in 2020 and an estimated $10.35 in 2021, with easing of inflationary headwinds.Jan 27, 2022
Should I invest in Caterpillar Inc?
Caterpillar currently has a Zacks Rank #3 (Hold) and a VGM Score of A. Our research shows that stocks with a VGM Score of A or B combined with a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 offer the best investment opportunities.Jan 11, 2022
Is Caterpillar stock undervalued?
Is Caterpillar Inc Stock Undervalued? The current Caterpillar Inc [CAT] share price is $227.81. The Score for CAT is 68, which is 36% above its historic median score of 50, and infers lower risk than normal. CAT is currently trading in the 60-70% percentile range relative to its historical Stock Score levels.
Is Caterpillar a cyclical stock?
Summary. Caterpillar has a highly cyclical business and a highly cyclical stock price.Feb 1, 2022
NYSE: CAT
Analyzing the construction equipment stock's recent fall and whether it's a good value now
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Raw material costs
Welcome to the wonderful world of highly cyclical stocks! Just as their earnings tend to oscillate wildly, so do their stock prices. That's particularly the case with equipment machinery manufacturer Caterpillar ( CAT 0.38% ). The stock started 2021 on a powerful note, but it's down more than 9% over the last three months.
Growth in China
Starting with raw material costs, CFO Andrew Bonfield said during the earnings call that the third-quarter profit margin would "moderate" from the second quarter.
Valuation concerns
Usually, with cyclical stocks, each region of the world tends to operate in tandem. However, COVID-19 originated in China and then spread to the rest of the world, meaning that China's growth trend has fallen out of step.
The bulls' case
Valuing a cyclical stock is always tricky. Not least because it sometimes makes sense to buy cyclical stocks on a high valuation and sell on a low valuation. They tend to trade on a high valuation precisely when earnings bottom and then take off.
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In response, it's worth highlighting a few points. First, rising raw material prices are an issue, but they stem from the fact that construction activity is strong, and so is energy and mining demand.
What happens if you buy Caterpillar stock?
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How much did Caterpillar spend on repurchases?
Answer: If you buy and hold Caterpillar stock, the expectation is over time the near-term fluctuations will cancel out, and the long-term positive trend will favor you - at least if the company is otherwise strong.
Is Caterpillar's revenue growth going to be good in 2020?
Caterpillar spent close to $9 billion on share repurchases between 2018 and 2020, resulting in a 8% drop in total shares outstanding. As such, on a per share basis, earnings plunged 47% to $5.51 in 2020, compared to $10.39 in 2018.
Is the average return after a rise lower than after a fall?
Outlook. 2020 has not been a great year for Caterpillar’s revenue growth, given the lower demand for equipment across its verticals - construction, resource, and energy & transportation. This can be attributed to the impact of the pandemic on the non-residential construction, and lower demand for energy.
Management is betting that margin pressures will be temporary and supply chain bottlenecks will ease
Answer: The average return after a rise is understandably lower than after a fall as detailed in the previous question. Interestingly, though, if a stock has gained over the last few days, you would do better to avoid short-term bets for most stocks - although CAT stock appears to be an exception to this general observation.
Referenced Symbols
Shares of Caterpillar Inc. took a dive Friday, as surging costs and a disappointing outlook on profit margins overshadowed a big quarterly earnings beat.
Is caterpillar mining slowing down?
Shares of Caterpillar Inc. took a dive Friday, as surging costs and a disappointing outlook on profit margins overshadowed a big quarterly earnings beat.
Is caterpillar a good company?
Although Caterpillar's mining industry sales are booming, its top market -- construction -- may be slowing down. Image source: Getty Images. However, the company saw year-over-year profit declines in both of its other business segments: construction and energy and transportation.
Why Caterpillar's Stock Declined
Raw Material Costs
- Starting with raw material costs, CFO Andrew Bonfield said during the earnings call that the third-quarter profit margin would "moderate" from the second quarter. Furthermore, he went on to note, "we do expect higher manufacturing costs, which means that our gross margin percentage will be moderately lower in the second half of the year versus the first half." That's a disappointment, a…
Growth in China
- Usually, with cyclical stocks, each region of the world tends to operate in tandem. However, COVID-19 originated in China and then spread to the rest of the world, meaning that China's growth trend has fallen out of step. As you can see below, the Asia/Pacific region recovered quicker than Europe and North America. The China economy was hit the hardest in the first quar…
valuation Concerns
- Valuing a cyclical stock is always tricky. Not least because it sometimes makes sense to buy cyclical stockson a high valuation and sell on a low valuation. They tend to trade on a high valuation precisely when earnings bottom and then take off. The cycle continues until they trade on low valuations at peak earnings, just as earnings start declining. You can see these dynamic…
The Bulls' Case
- In response, it's worth highlighting a few points. First, rising raw material prices are an issue, but they stem from the fact that construction activity is strong, and so is energy and mining demand. That's arguably a net positive for Caterpillar's revenue generation, and once the company starts pushing through price increases, its margin should improve. Second, the worries over China's gr…