Caterpillar (NYSE:CAT) Shares Down 5.2% – Time to Sell?

Shares of Caterpillar Inc. (NYSE:CAT) dropped 5.2% during trading on Wednesday. The company traded as low as $582.51 and last traded at $591.3350. Approximately 5,747,261 shares changed hands during trading, an increase of 99% from the average session volume of 2,883,586 shares. The stock had previously closed at $623.94.

Key Caterpillar News

Here are the key news stories impacting Caterpillar this week:

• Positive Sentiment: Strong results and backlog support the outlook. Caterpillar’s third-quarter earnings beat estimates, while its $78.1 billion backlog, stronger cash flow and expanding margins point to solid demand. The company is also expanding capacity to meet power-generation demand. Article: CAT Shares Fall Despite Q3 Earnings Beat
• Neutral Sentiment: Upcoming investor event. Construction Industries Group President Rod Shurman is scheduled to take part in a Bernstein-hosted fireside chat on Nov. 17; no new financial guidance was announced. Article: Caterpillar executive to participate in Bernstein fireside chat
• Negative Sentiment: AI-trade selling and valuation concerns weigh on the stock. Investors have been selling Caterpillar alongside other industrial companies amid worries that AI-related investment could slow. The market increasingly treats CAT as a data-center power play, exposing it to shifts in sentiment even though power generation accounted for about 15% of 2025 sales. Article: AI selloff spreads to industrials
• Negative Sentiment: Execution and cyclical risks remain. Reports cite orders falling, dealers trimming inventories, and tariffs, manufacturing costs and production constraints pressuring margins. Morgan Stanley also cut its price target by 26% after earnings, highlighting the risk of a cyclical test despite the backlog. Article: Morgan Stanley cuts Caterpillar price target

Analyst Upgrades and Downgrades

Several brokerages have recently commented on CAT. Zacks Research downgraded shares of Caterpillar from a “strong-buy” rating to a “hold” rating in a research note on Monday, October 5th. UBS Group cut their price target on shares of Caterpillar from $925.00 to $750.00 and set a “neutral” rating for the company in a report on Monday, October 26th. Royal Bank Of Canada reduced their price target on shares of Caterpillar from $897.00 to $722.00 and set a “sector perform” rating on the stock in a research report on Friday, October 30th. Weiss Ratings cut shares of Caterpillar from a “buy (b)” rating to a “buy (b-)” rating in a research note on Thursday, October 29th. Finally, DA Davidson dropped their price objective on shares of Caterpillar from $882.00 to $685.00 and set a “neutral” rating for the company in a report on Monday. Fifteen analysts have rated the stock with a Buy rating and twelve have given a Hold rating to the stock. According to MarketBeat.com, the stock presently has an average rating of “Moderate Buy” and a consensus price target of $898.25.

Caterpillar Trading Up 1.0%

The company has a debt-to-equity ratio of 1.50, a quick ratio of 0.88 and a current ratio of 1.42. The stock has a market capitalization of $257.10 billion, a price-to-earnings ratio of 21.94, a price-to-earnings-growth ratio of 1.02 and a beta of 1.65. The business has a fifty day simple moving average of $760.19 and a 200 day simple moving average of $806.23.

Caterpillar (NYSE:CAT) last released its quarterly earnings results on Thursday, October 29th. The industrial products company reported $7.20 EPS for the quarter, beating the consensus estimate of $7.06 by $0.14. Caterpillar had a net margin of 15.21% and a return on equity of 59.87%. The business had revenue of $20.68 billion for the quarter, compared to the consensus estimate of $20.76 billion. During the same period in the prior year, the company posted $4.95 earnings per share. Caterpillar’s revenue was up 17.3% compared to the same quarter last year. As a group, research analysts expect that Caterpillar Inc. will post 27.62 EPS for the current year.

Caterpillar Announces Dividend

The company also recently declared a quarterly dividend, which will be paid on Thursday, November 19th. Investors of record on Monday, October 26th will be paid a dividend of $1.63 per share. This represents a $6.52 dividend on an annualized basis and a yield of 1.2%. The ex-dividend date of this dividend is Monday, October 26th. Caterpillar’s dividend payout ratio is 25.58%.

Insider Buying and Selling

In other news, Director C Jr acquired 1,000 shares of the business’s stock in a transaction on Monday, November 2nd. The shares were purchased at an average cost of $620.39 per share, with a total value of $620,390.00. Following the acquisition, the director directly owned 4,714 shares of the company’s stock, valued at $2,924,518.46. The trade was a 26.93% increase in their ownership of the stock. The transaction was disclosed in a filing with the Securities & Exchange Commission, which can be accessed through this hyperlink. Also, CEO Joseph E. Creed sold 32,401 shares of the business’s 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 directly owned 34,555 shares in the company, valued at $27,954,303.90. This trade represents a 48.39% decrease in their ownership of the stock. The SEC filing for this sale provides additional information. 0.33% of the stock is owned by corporate insiders.

Hedge Funds Weigh In On Caterpillar

Institutional investors have recently made changes to their positions in the stock. BlackRock Inc. purchased a new stake in shares of Caterpillar in the second quarter worth $40,457,153,000. Bank of America Corp DE purchased a new position in Caterpillar in the second quarter worth about $5,818,150,000. Bank of New York Mellon Corp purchased a new stake in Caterpillar in the 2nd quarter worth about $3,192,710,000. Legal & General Group Plc purchased a new position in Caterpillar in the 2nd quarter worth about $2,783,451,000. Finally, Ascentis Wealth Management LLC lifted its holdings in shares of Caterpillar by 110,539.0% in the 2nd quarter. Ascentis Wealth Management LLC now owns 2,518,143 shares of the industrial products company’s stock worth $2,711,772,000 after buying an additional 2,515,867 shares during the period. Institutional investors own 70.98% of the company’s stock.

Caterpillar Company Profile

Caterpillar Inc is a global manufacturer of construction and mining equipment, engines, turbines, and related products and services. Its offerings include earthmoving and material-handling machines, diesel and natural gas engines, power-generation systems, and equipment and technologies used in mining and transportation. The company’s products are commonly sold under the Cat brand.

Caterpillar serves customers in markets around the world through a network of independent dealers. Its businesses also provide parts, maintenance, equipment rental, and other support services, as well as financing and insurance through its financial services operations.

The company was formed in 1925 through the merger of the Holt Manufacturing Company and the C.