Caterpillar (NYSE:CAT) Stock Price Down 2.5% – Should You Sell?

Caterpillar Inc. (NYSE:CAT)’s stock price was down 2.5% during trading on Friday. The company traded as low as $681.23 and last traded at $686.5230. Approximately 3,005,033 shares traded hands during mid-day trading, an increase of 7% from the average session volume of 2,821,297 shares. The stock had previously closed at $704.05.

Key Stories Impacting 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

Wall Street Analyst Weigh In

A number of equities analysts recently weighed in on CAT shares. UBS Group raised their price objective on Caterpillar from $900.00 to $925.00 and gave the company a “neutral” rating in a report on Wednesday, August 5th. Weiss Ratings raised Caterpillar from a “buy (b-)” rating to a “buy (b)” rating in a research note on Wednesday, October 14th. Freedom Broker upgraded shares of Caterpillar from a “hold” rating to a “buy” rating and set a $980.00 price target on the stock in a research report on Thursday, September 10th. Citigroup decreased their price target on shares of Caterpillar from $1,100.00 to $950.00 and set a “buy” rating on the stock in a research note on Monday, October 12th. Finally, Oppenheimer lowered their price objective on shares of Caterpillar from $1,118.00 to $1,009.00 and set an “outperform” rating for the company in a report on Wednesday, October 14th. Fifteen analysts have rated the stock with a Buy rating and twelve have issued a Hold rating to the company’s stock. According to MarketBeat, the stock currently has an average rating of “Moderate Buy” and a consensus price target of $967.83.

Caterpillar Price Performance

The firm has a market cap of $315.57 billion, a PE ratio of 29.54, a price-to-earnings-growth ratio of 1.27 and a beta of 1.58. The company has a debt-to-equity ratio of 1.65, a current ratio of 1.37 and a quick ratio of 0.85. The firm has a 50-day simple moving average of $802.23 and a 200 day simple moving average of $856.84.

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

Caterpillar Dividend Announcement

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

Insider Transactions at Caterpillar

In other Caterpillar news, CEO Joseph E. Creed sold 32,401 shares of the company’s stock in a transaction that occurred on Friday, August 28th. The shares were sold at an average price of $808.98, for a total transaction of $26,211,760.98. Following the completion of the sale, the chief executive officer directly owned 34,555 shares of the company’s stock, valued at approximately $27,954,303.90. This represents a 48.39% decrease in their ownership of the stock. The sale was disclosed in a filing with the Securities & Exchange Commission, which is accessible through the SEC website. Insiders own 0.33% of the company’s stock.

Institutional Investors Weigh In On Caterpillar

A number of institutional investors and hedge funds have recently bought and sold shares of the business. BlackRock Inc. purchased a new position in Caterpillar during the second quarter valued at $40,457,153,000. State Street Corp lifted its stake in Caterpillar by 4.0% in the 2nd quarter. State Street Corp now owns 36,276,960 shares of the industrial products company’s stock worth $37,120,529,000 after purchasing an additional 1,396,356 shares in the last quarter. Bank of America Corp DE purchased a new stake in Caterpillar in the 2nd quarter worth $5,818,150,000. Bank of New York Mellon Corp bought a new position in shares of Caterpillar during the 2nd quarter valued at about $3,192,710,000. Finally, Legal & General Group Plc purchased a new position in shares of Caterpillar during the second quarter valued at about $2,783,451,000. 70.98% of the stock is owned by institutional investors.

About Caterpillar

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.