CATERPILLAR a buy?

[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.

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!

I bought Phillip Morris during the Clinton years when they were getting hit hard in the courts. Bought them at $23.50, and from there they just kept rising. The yield at the time was something 9.3%. I made a small fortune with that one stock when I finally sold several years later.

Goes to show that the best time to buy a straw hat is winter.

 

[Valerie]

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!

I bought Phillip Morris during the Clinton years when they were getting hit hard in the courts. Bought them at $23.50, and from there they just kept rising. The yield at the time was something 9.3%. I made a small fortune with that one stock when I finally sold several years later.

Goes to show that the best time to buy a straw hat is winter.

So true! Great story!




And I can't say enough about the benefits of achieving this sort of growth in a tax free Roth IRA! Back in 2009 I bought CAT in hundred share increments for a total of 700 shares at an average cost of $30. Now I am going to sell some of the shares and put my initial investment back into cash (within the Roth) that way the rest is gravy no matter what happens with CAT I am on top of it with no worries and I pay no tax on that ever!

 

[topspin]

I've had the alley cat for a long time, be carefull.

 

[Douger]

ETF's
Brazil, Uruguay, Paraguay, Chile

 

[topspin]

thanks Contra Doug

 

[Valerie]

today i'm gonna sell some and take some cash off the table.


CAT 10:57AM 108.87 Up 1.62 Up 1.51% 107.64 108.91 2,821,303 4,542,720 67.96B

http://finance.yahoo.com/q;_ylt=AhzVGa5l7yT5_I2X3r_blAULv7gF;_ylu=X3oDMTExa25rZXV1BHBvcwMzNARzZWMDeWZpUXVvdGVzVGFibGUEc2xrA2NhdA--?s=CAT

 

[Picaro]

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....

Might be worth a gamble. Where will the taxes and revenue come from to pay for all of it? It's now considered 'bad' to tax anybody who can actually afford to pay taxes, and Romney says half the country doesn't pay any taxes.

I guess some sort of 'invisible hand' will magically appear and make it all good.

 

[Rozman]

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.

when the economy rebounds.

I'm 61 now....
Will this shitty economy rebound in my life time....
Let's say I have 20 years left... LOL

 

[Picaro]

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.

when the economy rebounds.

I'm 61 now....
Will this ****ty economy rebound in my life time....
Let's say I have 20 years left... LOL

It's going to be tough in a 'service economy' to keep pumping up asset price bubbles and getting the suckers to borrow heavily on imaginary 'equity' over and over and over, as has been the case since the oil crisis era.

 

[fanger]

DETROIT — After passionate debate over how best to help break the deadlock between Israel and the Palestinians, the Presbyterian Church (U.S.A.) voted on Friday at its general convention to divest from three companies that it says supply Israel with equipment used in the occupation of Palestinian territory.

The B.D.S. campaign has gained support in Europe, but has not fared as well in the United States, where two relatively small academic groups voted this year to support an academic boycott of Israel, but larger groups as well as many universities have opposed it.


The companies the church has targeted for divestment are Caterpillar, Hewlett-Packard and Motorola Solutions. The church has about $21 million invested in them, a spokeswoman said. The church says it has tried for many years to convey its concerns that the companies are profiting from Israel’s occupation of Palestinian territories by selling it bulldozers, surveillance technology and other equipment.

http://www.nytimes.com/2014/06/21/u...-occupation-vote-to-divest-holdings.html?_r=0

 

[Zmrzlina]

They aren't a good buy unless you are ok with a company being complicit in war crimes. http://www.thejerusalemfund.org/images/WarCrimesLitigation.pdf