Is It Time to Sell Caterpillar Inc (NYSE:CAT)?

[Market Watch] Caterpillar Inc (NYSE:CAT)(TREND ANALYSISDoug Oberhelman spent his first years as Caterpillar Inc.’s chief executive plowing billions of dollars into factories to build more of its familiar yellow machines and move the company deeper into mining equipment.

It was a bold bet, spectacularly mistimed.

The world was gripped by a global commodities boom in 2010 when he took charge, along with strong postrecession demand from developing markets and the energy industry. The world was ordering excavators and bulldozers and giant dump trucks at a rapid clip.

Oberhelman bet he could grab an outsize share if he could just make more equipment. He spent almost $10 billion world-wide on plants and equipment from 2010 through 2013.

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Caterpillar Inc (NYSE:CAT) stock is currently trading 2.45% below its 52-week-high, 55.55% above its 52-week-low. The 1-year stock price history is in the range of $56.36 – $89.87. Caterpillar Inc (CAT) has a price to earnings ratio of 58.45 versus Industrial Goods sector average of 36.38. CAT stock price has outperformed the S&P 500 by 27%. The Construction & Mining Machinery company is currently valued at $51.22 billion, and its share price closed the last trading session at $87.67. The stock has a 50-day moving average of $84.36 and a 200-day moving average of $79.01.

Caterpillar Inc (CAT) current short interest stands at 41.7 million shares. It has increased by 1% from the same period of last month. Around 8% of the company’s shares, which are float, are short sold. With a 10-days average volume of 4.53 million shares, the number of days required to cover the short positions stand at 9.3 days.

CAT is forecasted to report earnings per share of $0.77 and a revenue of $9.84 billion for the 3rd Quarter of the fiscal year 2016. Caterpillar Inc (CAT) expects to post results on October 25. The Construction & Mining Machinery company announced last quarter earnings per share of $1.09 against a consensus Street estimate of $0.96, beating the average estimate by $0.13. The company posted a revenue of $10.34 billion compared to an estimation of $10.06 billion.

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There are currently twenty-three analysts that cover Caterpillar Inc stock. Of those twenty-three, four have a Buy rating, sixteen have a Hold rating and three have a Sell rating. On a consensus basis this yields to a Hold rating. The consensus target price stands at $81.42.

A recent analyst activity consisted of Goldman Sachs upgrading their Neutral rating to Buy on October 11. Goldman Sachs increased their price target on CAT from $76 to $112. This corresponds to a 27.75% upside from the last closing price. On the date of report, the stock closed at $87.47.

OTR Global downgraded their Positive rating to Mixed on September 19. On the date of report, the stock closed at $81.88.

Another research firm was Deutsche Bank who initiated their coverage on the stock with Buy rating on September 7. Deutsche Bank fixed their price target at $98. This translates to a 11.78% upside from the last closing price. On the date of report, the stock closed at $83.72.

Company snapshot

Caterpillar Inc. designs, manufactures and markets construction, mining and forestry machinery. The Company also manufactures engines and other related parts for its equipment, and offers financing and insurance. Caterpillar distributes its products through a worldwide organization of dealers.

Is It Time to Sell Caterpillar Inc (NYSE:CAT)? was last modified: October 17th, 2016 by Steven Finley