Caterpillar (NYSE:CAT) Shares Down 1.6% on Analyst Downgrade

Caterpillar Inc. (NYSE:CAT)’s share price traded down 1.6% on Monday after Freedom Broker lowered their price target on the stock from $980.00 to $800.00. Freedom Broker currently has a buy rating on the stock. Caterpillar traded as low as $609.89 and last traded at $612.7780. 4,202,497 shares traded hands during trading, an increase of 47% from the average session volume of 2,866,165 shares. The stock had previously closed at $622.75.

Several other equities research analysts also recently weighed in on CAT. DA Davidson decreased their target price on Caterpillar from $882.00 to $685.00 and set a “neutral” rating for the company in a research report on Monday. Robert W. Baird set a $970.00 price target on Caterpillar in a research report on Wednesday, August 5th. Zacks Research lowered shares of Caterpillar from a “strong-buy” rating to a “hold” rating in a research note on Monday, October 5th. Weiss Ratings cut shares of Caterpillar from a “buy (b)” rating to a “buy (b-)” rating in a research report on Thursday. Finally, Wells Fargo & Company decreased their target price on shares of Caterpillar from $1,155.00 to $840.00 and set an “overweight” rating for the company in a research note on Monday, October 26th. Fifteen equities research analysts have rated the stock with a Buy rating and twelve have given a Hold rating to the company’s stock. According to data from MarketBeat.com, Caterpillar currently has an average rating of “Moderate Buy” and an average target price of $898.25.

Insider Buying and Selling

In related news, CEO Joseph E. Creed sold 32,401 shares of the stock in a transaction dated Friday, August 28th. The stock was sold at an average price of $808.98, for a total value 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 approximately $27,954,303.90. This represents a 48.39% decrease in their ownership of the stock. The sale was disclosed in a document filed with the SEC, which is accessible through this link. Corporate insiders own 0.33% of the company’s stock.

Caterpillar News Summary

Here are the key news stories impacting Caterpillar this week:

• Positive Sentiment: Strong backlog supports future revenue. Caterpillar’s third-quarter order backlog reached a record $78 billion, extending delivery timelines well into the next decade. Power-generation sales to end users rose 75%, driven largely by data-center demand. Caterpillar: 3 Key Takeaways for Long-Term Investors
• Positive Sentiment: Recent results showed continued growth. Third-quarter revenue increased 17.3% year over year to $20.68 billion, while adjusted earnings of $7.20 per share exceeded analysts’ expectations. CAT Q3 deep dive
• Positive Sentiment: Some analysts remain constructive. Truist reiterated its Buy rating, while Freedom Broker maintained a Buy rating despite reducing its price target to $800. One global bank reportedly sees potential for an approximately 85% gain if Caterpillar’s backlog and growth opportunities are fully recognized. Truist reiterates Buy rating
• Neutral Sentiment: Caterpillar acquired John Fabick Tractor Company, a Cat dealership serving parts of the Midwest. The transaction expands Caterpillar’s direct dealer operations and customer relationships, although financial terms were not disclosed. Caterpillar Inc. Acquires Fabick Cat Dealership
• Negative Sentiment: Analysts are cutting targets because of valuation concerns. DA Davidson reduced its target to $685 from $882 and kept a Neutral rating, arguing CAT trades at roughly a 50% premium to peers. Freedom Broker also lowered its target, while RBC, Citigroup, JPMorgan and Morgan Stanley have issued additional cautious outlooks. CAT Stock Gets Price Target Cuts

Hedge Funds Weigh In On Caterpillar

Several institutional investors and hedge funds have recently made changes to their positions in CAT. BlackRock Inc. bought a new stake in shares of Caterpillar in the 2nd quarter worth about $40,457,153,000. State Street Corp lifted its position in shares of Caterpillar by 4.0% during the second 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 during the last quarter. Bank of America Corp DE acquired a new position in Caterpillar in the second quarter worth about $5,818,150,000. Bank of New York Mellon Corp acquired a new position in Caterpillar in the second quarter worth about $3,192,710,000. Finally, Legal & General Group Plc bought a new stake in Caterpillar in the second quarter valued at about $2,783,451,000. 70.98% of the stock is currently owned by hedge funds and other institutional investors.

Caterpillar Stock Performance

The company has a fifty day moving average of $783.25 and a two-hundred day moving average of $807.52. The stock has a market capitalization of $281.68 billion, a P/E ratio of 24.04, a price-to-earnings-growth ratio of 1.07 and a beta of 1.65. The company has a debt-to-equity ratio of 1.50, a current ratio of 1.42 and a quick ratio of 0.88.

Caterpillar (NYSE:CAT) last released its earnings results on Thursday, October 29th. The industrial products company reported $7.20 EPS for the quarter, topping analysts’ consensus estimates of $7.06 by $0.14. The company had revenue of $20.68 billion for the quarter, compared to the consensus estimate of $20.76 billion. Caterpillar had a return on equity of 59.87% and a net margin of 15.21%. Caterpillar’s quarterly revenue was up 17.3% compared to the same quarter last year. During the same quarter last year, the business posted $4.95 EPS. On average, equities analysts anticipate that Caterpillar Inc. will post 27.75 EPS for the current year.

Caterpillar Dividend Announcement

The firm also recently disclosed a quarterly dividend, which will be paid on Thursday, November 19th. Shareholders of record on Monday, October 26th will be issued a $1.63 dividend. This represents a $6.52 dividend on an annualized basis and a yield of 1.1%. The ex-dividend date of this dividend is Monday, October 26th. Caterpillar’s payout ratio is currently 25.58%.

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.