CATERPILLAR a buy?

[usmbtech]

What are you thoughts on Caterpillar, do you think its a good long term buy?

 

[Valerie]

What are you thoughts on Caterpillar, do you think its a good long term buy?

BUY!

FYI - It just got downgraded by someone today from buy to hold, but I rarely give much credence to that stuff any more. For an example, just look at how B of A's recommendation on CAT went from hold to buy in June of 06 when it fell into the 60s and then from buy to hold in the end of 08 when it was in the 30s.

Sometimes, they tell you to buy when they want you to buy their shares! And then they tell you to sell when they want to buy your shares from you! Or someone makes you skittish by downgrading from buy to hold, like today.

I say, if it's worth holding then of course it's worth buying when at it's lowest price.

Also, I just read....Cramer says BUY - BUY - BUY!

Cramer's Stop Trading! 6 Quick Earnings Picks (1/27/09) -- Seeking Alpha

Caterpillar (CAT): In spite of a gloomy forecast, Cramer still likes Caterpillar for its 5% dividend. From a technical standpoint, the stock is putting in a base.

There are better "trades" out there, but I think it's a solid long term investment.

 

[manu1959]

well lets see.....when all the various state governments put all their road and bridges and tunnels on hold.....the wiped out the need for heavy construction equipment.....the stock tanked and caterpillar laid off a bunch of people....

now obama is abot to pass out millions to the sates to start up all those projects......

hmmmmmmmmmmm.......i wonder what will happen then....

 

[Valerie]

well lets see.....when all the various state governments put all their road and bridges and tunnels on hold.....the wiped out the need for heavy construction equipment.....the stock tanked and caterpillar laid off a bunch of people....

now obama is abot to pass out millions to the sates to start up all those projects......

hmmmmmmmmmmm.......i wonder what will happen then....

Exactly, the stimulus package and the infrastructure bill will be a CATalyst!

 

[jillian]

well lets see.....when all the various state governments put all their road and bridges and tunnels on hold.....the wiped out the need for heavy construction equipment.....the stock tanked and caterpillar laid off a bunch of people....

now obama is abot to pass out millions to the sates to start up all those projects......

hmmmmmmmmmmm.......i wonder what will happen then....

Yep!! BUY!! BUY!!! BUY!!!!

 

[DavidS]

SELL SELL SELL if you need money now! New home construction has nowhere to go but down from here since we can't fill the homes that are already built. New construction projects around the country that would require a caterpillar are plummeting. The only reason you should hold onto this company is if you don't need cash in the next 2-3 years and you want it to really rise up in value, which it will do when the economy rebounds. I would go so far to say that we may be taking such drastic action that we could face a housing shortage in less than a decade from now.

 

[usmbtech]

Wow, down to $31.16, can't seem to win with this one

 

[Valerie]

Wow, down to $31.16, can't seem to win with this one

I've been keeping an eye on the volume. Prior to the earnings announcement in January, the average daily volume was around 13 million. That day it purged downward and broke through it's 52 week low with volume of 47 million. In the following days it snuck below $30 per share but the volume was less than the prior breakthrough. I see that as a good sign. In the past few weeks the price has remained flat and the volume has died down and returned to it's normal lower level. I think this is a bullish sign. If you see the price start to move up and the volume stays flat, that means it's not real, it doesn't have conviction. So, this is what I watch for when I'm deciding what to do next. I like the way the price has help up and I'm looking for a catalyst to take it up with real volume.

I am holding it in my retirement account so I am willing to be patient.

PRICES
Date Open High Low Close Volume Adj Close*
12-Feb-09 30.75 31.09 30.03 31.02 13,662,000 31.02
11-Feb-09 31.35 31.93 30.65 31.13 10,544,900 31.13
10-Feb-09 32.86 33.31 30.61 30.92 17,205,600 30.92
9-Feb-09 33.47 33.60 32.40 32.72 9,063,700 32.72
6-Feb-09 32.38 33.85 32.21 33.28 17,010,100 33.28
5-Feb-09 30.35 32.09 30.20 31.61 17,793,300 31.61
4-Feb-09 30.44 31.57 30.20 30.60 17,419,200 30.60
3-Feb-09 29.81 31.03 29.81 29.99 18,880,200 29.99
2-Feb-09 30.10 30.80 29.60 30.29 16,966,700 30.29
30-Jan-09 31.58 31.73 30.06 30.85 20,956,900 30.85
29-Jan-09 32.61 32.66 31.63 31.85 14,575,000 31.85
28-Jan-09 33.26 33.51 32.62 33.00 13,466,700 33.00
27-Jan-09 33.24 33.42 32.10 32.32 20,354,500 32.32
26-Jan-09 33.60 34.24 31.70 32.67 47,390,400 32.67

CAT: Summary for CATERPILLAR INC - Yahoo! Finance

 

[RodISHI]

Take a look out there at how much used equipment has already flooded the market before you decide. Even the larger construction companies have been buying used equipment to finish up some leftover contract road projects that were on the books prior the crunch.

 

[dilloduck]

I've been keeping an eye on the volume. Prior to the earnings announcement in January, the average daily volume was around 13 million. That day it purged downward and broke through it's 52 week low with volume of 47 million. In the following days it snuck below $30 per share but the volume was less than the prior breakthrough. I see that as a good sign. In the past few weeks the price has remained flat and the volume has died down and returned to it's normal lower level. I think this is a bullish sign. If you see the price start to move up and the volume stays flat, that means it's not real, it doesn't have conviction. So, this is what I watch for when I'm deciding what to do next. I like the way the price has help up and I'm looking for a catalyst to take it up with real volume.

I am holding it in my retirement account so I am willing to be patient.

Weird, Val----I look at women sorta the same way you look at stocks !

 

[Valerie]

I've been keeping an eye on the volume. Prior to the earnings announcement in January, the average daily volume was around 13 million. That day it purged downward and broke through it's 52 week low with volume of 47 million. In the following days it snuck below $30 per share but the volume was less than the prior breakthrough. I see that as a good sign. In the past few weeks the price has remained flat and the volume has died down and returned to it's normal lower level. I think this is a bullish sign. If you see the price start to move up and the volume stays flat, that means it's not real, it doesn't have conviction. So, this is what I watch for when I'm deciding what to do next. I like the way the price has help up and I'm looking for a catalyst to take it up with real volume.

I am holding it in my retirement account so I am willing to be patient.

Weird, Val----I look at women sorta the same way you look at stocks !

Don't forget the dividends! Div & Yield: 1.68 (5.40%)

 

[dilloduck]

I've been keeping an eye on the volume. Prior to the earnings announcement in January, the average daily volume was around 13 million. That day it purged downward and broke through it's 52 week low with volume of 47 million. In the following days it snuck below $30 per share but the volume was less than the prior breakthrough. I see that as a good sign. In the past few weeks the price has remained flat and the volume has died down and returned to it's normal lower level. I think this is a bullish sign. If you see the price start to move up and the volume stays flat, that means it's not real, it doesn't have conviction. So, this is what I watch for when I'm deciding what to do next. I like the way the price has help up and I'm looking for a catalyst to take it up with real volume.

I am holding it in my retirement account so I am willing to be patient.

Weird, Val----I look at women sorta the same way you look at stocks !

Don't forget the dividends! Div & Yield: 1.68 (5.40%)

How could I possibly miss something as important as the Yield and Dividends ?

 

[auditor0007]

One thing to keep in mind; the infrastructure spending in the stimulus bill is only $46 billion, and it's not all going to roads. Caterpillar has already said that despite the stimulus bill, they will be laying off even more workers. I would not say that it's a sell because it already is running fairly low and will eventually come back. I think a hold call is in order.

 

[Missourian]

After 50 years as an emblem of American trucker culture, Caterpillar Inc has said that it will bring its North American commercial diesel engine production operations to an end in 2009.

The world's largest maker of construction and mining equipment went on to state that it is to form an alliance with Navistar International Corp to build and sell a variety of trucks worldwide.

With new clean air restrictions, speculators believed Caterpillar would exit the on-highway business, but the alliance disproves such rumors, with the two companies planning to cooperate to develop, manufacture and distribute both medium and heavy duty commercial trucks outside of North America. <MORE>

No more CAT engines in US trucks. They could not meet EPA standards and continue to build a quality engine so they decided to produce a quality engine and take their chances distributing in non-US markets.

Very sad...great engines.

http://www.execdigital.co.uk/Caterpillar-to-stop-diesel-engine-production_6216.aspx

 

[Valerie]

CATERPILLAR INC
(NYSE: CAT)

Real-Time: 52.06 Up 0.86 (1.68%) 3:03PM EThelp
Last Trade: 52.22
Trade Time: 2:48PM ET
Change: Up 1.02 (1.99%)
Prev Close: 51.20
Open: 51.75
Bid: N/A
Ask: N/A
1y Target Est: 45.69
Day's Range: 51.25 - 52.40
52wk Range: 21.71 - 64.20
Volume: 4,461,031
Avg Vol (3m): 12,880,100
Market Cap: 32.44B
P/E (ttm): 18.01
EPS (ttm): 2.901
Div & Yield: 1.68 (3.30%)

CAT: Summary for CATERPILLAR INC - Yahoo! Finance

 

[DavidS]

Oops!

 

[Valerie]

CAT hit a new 52 week high yesterday and today!

Caterpillar, Inc. Common Stock
(NYSE: CAT)

Real Time: 76.15 Down 0.03 (0.04%) 3:48PM EDT
Last Trade: 76.35
Trade Time: 3:33PM EDT
Change: Up 0.17 (0.22%)
Prev Close: 76.18
Open: 75.42
Bid: 76.35 x 200
Ask: 76.36 x 300
1y Target Est: 80.80
Day's Range: 75.00 - 77.50
52wk Range: 47.50 - 77.50
Volume: 7,416,896
Avg Vol (3m): 7,971,470
Market Cap: 48.14B
P/E (ttm): 31.16
EPS (ttm): 2.46
Div & Yield: 1.76 (2.30%)

CAT: Summary for Caterpillar, Inc. Common Stock- Yahoo! Finance

 

[Valerie]

Notice as the price has risen the dividend yield moved inversely...from 5.4% to 2.3%

 

[Meister]

Notice as the price has risen the dividend yield moved inversely...from 5.4% to 2.3%

Yeah, because as the rise in price the dividend hasn't increased.

 

[Valerie]

Notice as the price has risen the dividend yield moved inversely...from 5.4% to 2.3%

Yeah, because as the rise in price the dividend hasn't increased.

Yes, that's the funny thing about percentages which is what I was trying to illustrate.



In Jan 09 you could buy in at $30 and get a dividend of $1.68 per share, which when you express as a percentage of the price was around 5.4%

In Sept of 09 you could buy in at around $50 and still get the same dividend of $1.68 per share, which when expressed as a percent of the price was around 3.4%

So if you had bought in at $30 you would still have been yielding a dividend of 5.4% of your cost. So the cost of yielding a $1.68 dividend went up.


Now today the dividend is actually up a bit to $1.76 per share, which when expressed as a percentage of the price is around 2.30%.


SO if you bought in at $30, not only did you gain $46 per share, your dividend yield actually went up by .8 cents per share!


A win / win all around! True story!