Caterpillar (NYSE:CAT) Shares Down 5% – What’s Next?

Caterpillar Inc. (NYSE:CAT) fell 5% on Thursday. The stock traded as low as $695.33 and last traded at $703.2980. Approximately 3,044,472 shares changed hands during trading, an increase of 8% from the average session volume of 2,822,256 shares. The stock had previously closed at $740.21.

Trending Headlines about Caterpillar

Here are the key news stories impacting Caterpillar this week:

• Positive Sentiment: Analysts expect Caterpillar to deliver year-over-year earnings growth in its upcoming third-quarter report. The company’s positive Earnings ESP and favorable estimate revisions suggest potential for an earnings beat, supported by manufacturing strength and demand for industrial equipment. Caterpillar Reports Next Week: Wall Street Expects Earnings Growth
• Positive Sentiment: Technical and fundamental indicators are encouraging some investors to view the recent decline as a buying opportunity. A hammer chart pattern points to possible support, while upward earnings-estimate revisions could help drive a near-term recovery. Bears Are Losing Control Over Caterpillar
• Positive Sentiment: Zacks lists Caterpillar among industrial companies with the potential to outperform third-quarter earnings expectations, reflecting continued confidence in the sector’s demand environment. Industrial Stocks Set to Outshine Q3 Earnings Estimates
• Neutral Sentiment: The key catalyst is Caterpillar’s forthcoming quarterly report. Investors will focus on whether earnings growth, revenue momentum and management’s outlook validate the optimistic estimates. The company’s previous quarter featured a substantial earnings and revenue beat, providing a supportive comparison.
• Negative Sentiment: The recent selloff has materially weakened CAT’s momentum and caused it to underperform the S&P 500, with much of the decline concentrated in only a few trading sessions. Continued investor caution, profit-taking or disappointment in the upcoming report could keep pressure on the shares. Caterpillar Just Dropped 10% in a Month

Analyst Upgrades and Downgrades

Several analysts have issued reports on the company. Zacks Research lowered Caterpillar from a “strong-buy” rating to a “hold” rating in a research note on Monday, October 5th. Sanford C. Bernstein reiterated a “market perform” rating and set a $749.00 price target on shares of Caterpillar in a research note on Wednesday, October 14th. Barclays lifted their price objective on Caterpillar from $800.00 to $900.00 and gave the stock an “equal weight” rating in a report on Thursday, August 6th. President Capital began coverage on Caterpillar in a research note on Friday, September 18th. They issued a “buy” rating and a $999.00 price objective on the stock. Finally, UBS Group boosted their price objective on Caterpillar from $900.00 to $925.00 and gave the company a “neutral” rating in a research note on Wednesday, August 5th. Fifteen research analysts have rated the stock with a Buy rating and twelve have assigned a Hold rating to the company’s stock. According to MarketBeat, the company has an average rating of “Moderate Buy” and a consensus price target of $967.83.

Caterpillar Price Performance

The firm has a market capitalization of $315.57 billion, a PE ratio of 29.54, a price-to-earnings-growth ratio of 1.20 and a beta of 1.58. The company has a debt-to-equity ratio of 1.65, a quick ratio of 0.85 and a current ratio of 1.37. The business’s 50 day moving average is $798.82 and its two-hundred day moving average is $855.65.

Caterpillar (NYSE:CAT) last issued its earnings results on Tuesday, August 4th. The industrial products company reported $8.17 earnings per share (EPS) for the quarter, beating analysts’ consensus estimates of $6.22 by $1.95. Caterpillar had a net margin of 14.51% and a return on equity of 55.53%. The business had revenue of $20.54 billion for the quarter, compared to analysts’ expectations of $19.34 billion. During the same quarter in the previous year, the firm posted $4.72 EPS. The business’s revenue for the quarter was up 23.7% compared to the same quarter last year. Equities research analysts anticipate that Caterpillar Inc. will post 27.74 earnings per share for the current fiscal year.

Caterpillar Announces Dividend

The business also recently disclosed a quarterly dividend, which will be paid on Thursday, November 19th. Investors of record on Monday, October 26th will be issued a dividend of $1.63 per share. The ex-dividend date of this dividend is Monday, October 26th. This represents a $6.52 dividend on an annualized basis and a yield of 0.9%. Caterpillar’s dividend payout ratio is 28.06%.

Insider Buying and Selling

In other Caterpillar news, CEO Joseph E. Creed sold 32,401 shares of Caterpillar stock in a transaction dated Friday, August 28th. The stock was sold at an average price of $808.98, for a total transaction of $26,211,760.98. Following the completion of the transaction, the chief executive officer owned 34,555 shares of the company’s stock, valued at $27,954,303.90. The trade was a 48.39% decrease in their position. The transaction was disclosed in a filing with the Securities & Exchange Commission, which is available through this link. 0.33% of the stock is currently owned by corporate insiders.

Institutional Investors Weigh In On Caterpillar

A number of institutional investors and hedge funds have recently modified their holdings of the company. BlackRock Inc. bought a new position in shares of Caterpillar in the 2nd quarter worth about $40,457,153,000. Bank of America Corp DE bought a new stake in Caterpillar during the second quarter worth about $5,818,150,000. Diamant Asset Management Inc. boosted its stake in Caterpillar by 68,427.2% during the first quarter. Diamant Asset Management Inc. now owns 3,140,603 shares of the industrial products company’s stock worth $2,224,992,000 after acquiring an additional 3,136,020 shares in the last quarter. Bank of New York Mellon Corp purchased a new stake in Caterpillar in the second quarter worth about $3,192,710,000. Finally, Legal & General Group Plc purchased a new stake in Caterpillar in the second quarter worth about $2,783,451,000. 70.98% of the stock is owned by hedge funds and other institutional investors.

Caterpillar Company Profile

Caterpillar Inc is a manufacturer of construction, mining, and industrial equipment. Its product portfolio includes excavators, bulldozers, wheel loaders, motor graders, articulated trucks, and other machinery used in construction, infrastructure development, mining, quarrying, forestry, and related industries. The company also produces diesel and natural gas engines, industrial gas turbines, generator sets, and other power-generation and transportation equipment.

Caterpillar operates through businesses focused on construction industries, resource industries, and energy and transportation.