The Caterpillar Inc. (NYSE:CAT) bears won the day, but the reality is that the -0.18 points or -0.14 percent decline gave very little definitive technical indication of where the stock could be headed next. On 08 February, the shares traded at $128.6 with a light trade volume of 3.104 million shares. After opening the session at $127.48, the shares went as high as $128.6 and as low as $126.55, the range within which the stock’s price traded throughout the day. The firm is left with a market cap of $76 billion and now has 590.93 million shares outstanding. Caterpillar Inc. (CAT) stock has lost -1.28 percent of market value in 21 trading days.
CAT stock has a trailing 3-year beta of 1.47, offering the possibility of a higher rate of return, but also posing more risk. The portion of a company’s profit allocated to each outstanding share of common stock was $10.06 a share in the trailing twelve months. The stock’s value has surged 1.2 percent year to date (YTD) against a decline of -16.68 percent in 12 month’s time. The company’s shares still trade -21.87 percent away from its 1-year high of $164.60 and 14.76 percent up from 52-week low of $112.06. The average consensus rating on the company is 2.2, on a scale where 5 equates to a unanimous sell rating. In short, the mean analyst recommendations are calling this stock a sell.
Caterpillar Inc. (CAT) will probably climb 13.38 percent over the next 12 months, according to price target estimates compiled by finviz. Meanwhile, they have set a $189 price as 12-month high target. This represents a whopping 46.97 percent increase from where shares are trading today. The 12-month median price target assigned by the analysts stands at $154.4, which represents a return potential of 20.06 percent when compared to the closing price of the stock of $128.6 on Friday, February 08. The lowest price target for the stock is $105 — slightly more than -18.35 percent from CAT’s current share price.
History has shown that shares in Caterpillar Inc. have gone up on 20 different earnings reaction days and are predicted to add 0.03 percent when the company reports upcoming earnings. Investors will get their next glimpse of CAT’s Q1 earnings on April 24. Analysts are forecasting revenue to climb 4.3 percent to $13.4B in the fiscal first quarter, while earnings are seen soaring by nearly 1.77 percent to $2.87 per share. It earned $2.55 per share, worse than the $2.99, adjusted, expected by Thomson Reuters consensus estimate. Revenue was $14.3B, in line with the $14.3B analysts expected. Earnings are estimated to increase by 10 percent this year, 7.79 percent next year and continue to increase by 25.22 percent annually for the next 5 years.
Let’s take a look at some insider activity at Caterpillar Inc. (NYSE:CAT) and see the pattern. The earliest insider trade took place on 10/26/2018. De Lange Bob gathered a total of 1.08 thousand shares of company at average share price of $115.58. The total for the purchase was set at $124.83 thousand. After this transaction, the Group President account balance stood at 11.31 thousand shares. The stock grew 11.26 percent since that insider purchase. On 10/02/2018, Johnson Denise C, Group President, sold 35.05 thousand shares at a price per share of $154.18. This removed 5.4 million shares from the insider’s fortune and the stock saw a -16.59 percent retreat in value since the news became public. This transaction left 11.56 thousand shares in the Group President account.
On 05/14/2018, Director Calhoun David L performed a purchase transaction worth $776.85 thousand. This purchase at $155.37 each has added 5 thousand shares into the insider’s portfolio position. Meanwhile, shares have recorded -17.23 percent decrease since the transaction was reported. The insider now is left with 44.58 thousand shares remaining in the account. Creed Joseph E, who performs the Interim CFO job, sold 4.53 thousand shares for $705.5 thousand. The disposal occurred on 05/11/2018 was priced at $155.67 per share. The share price plunged -17.39 percent since the reporting date. Creed Joseph E now left with a stake of 8.31 thousand CAT stock worth $1.07 million after the insider selling.
The stock is currently hovering around the first support level of $127.23. Below this, the next support is placed in the zone of $125.87. Till the time, the CAT stock trades above this level, bulls have nothing to fear. On momentum oscillators front, ‘RSI’ has touched 48.05 on daily chart, which may remain a cause for concern. If the price breaks below $125.87 level on closing basis, then we may see more profit booking and the stock may show further weakness. On the flipside, hitting the $129.28 mark may result into a pull-back move towards $129.97 level.
Shares of Caterpillar Inc. (CAT) are trading at a P/E ratio of 12.79 times earnings reported for the past 12 months. The industry CAT operates in has an average P/E of 12.81. Its P/E ratio went as low as 12.6X and as high as 30.22 over the 5-year span.Further, it is sporting a 1.39 on the Price-to-Sales ratio. Compare this with the industry average P/S of 0.9. 32.6 percent is the gross profit margin for Caterpillar Inc. and operating margin sits at 12.7 percent. Along with this, the net profit margin is 5.7 percent.