Caterpillar Downgraded to “Market Perform” at Raymond James (CAT)
Caterpillar (NYSE:CAT) was downgraded by analysts at Raymond James from an “outperform” rating to a “market perform” rating in a research report issued to clients and investors on Thursday, TheFlyOnTheWall.com reports. They currently have a $89.00 price objective on the stock, down from their previous price objective of $93.75. Raymond James’ target price would suggest a potential upside of 6.26% from the company’s current price.
The analysts wrote, “Heading into the quarter, we brought down our forecasts following two months of weak dealer stats. We also stated that we needed to see some type of real improvement in demand to maintain our optimistic view on the stock. In CAT’s release yesterday, EPS missed our forecast and the company revised its earnings outlook downwards (yet again) due to end market weakness. More specifically, continued Resources sales declines across all regions more than offset the (to-date tepid) recovery in US construction markets. In addition, the relatively stable Power Systems and Construction segments felt some of the knock-on effects of weaker commodities demand (i.e. lower sales of large construction equipment and standby power generation associated with mining activity). Looking to next year, the outlook is for further declines in new mining equipment orders and only small improvements in the parts business. Finally, not even dealer inventory reordering, despite several quarters of reductions, is expected to have a meaningful impact on sales in 2014. While we continue to view 2013 as a ‘transitionary’ year with CAT taking measures to reduce costs and capex, these efforts have been overshadowed by a more meaningful decline in sales. The worst has likely past for the company, in our view, and we expect an improvement in earnings next year as cost savings start to take effect.”
Caterpillar (NYSE:CAT) opened at 83.76 on Thursday. Caterpillar has a one year low of $79.49 and a one year high of $99.70. The stock’s 50-day moving average is $84.14 and its 200-day moving average is $85.4. The company has a market cap of $54.244 billion and a P/E ratio of 13.21. Caterpillar also saw some unusual options trading on Tuesday. Investors bought 34,025 put options on the company. This represents an increase of approximately 271% compared to the average daily volume of 9,169 put options.
Caterpillar (NYSE:CAT) last released its earnings data on Wednesday, October 23rd. The company reported $1.45 earnings per share (EPS) for the quarter, missing the consensus estimate of $1.71 by $0.26. The company had revenue of $13.42 billion for the quarter, compared to the consensus estimate of $14.49 billion. During the same quarter in the prior year, the company posted $2.54 earnings per share. The company’s quarterly revenue was down 18.4% on a year-over-year basis. On average, analysts predict that Caterpillar will post $6.20 earnings per share for the current fiscal year.
The company also recently declared a quarterly dividend, which is scheduled for Wednesday, November 20th. Stockholders of record on Monday, October 21st will be given a dividend of $0.60 per share. This represents a $2.40 dividend on an annualized basis and a yield of 2.87%. The ex-dividend date of this dividend is Thursday, October 17th.
Several other analysts have also recently commented on the stock. Analysts at S&P Equity Research downgraded shares of Caterpillar to a “hold” rating in a research note to investors on Wednesday. Separately, analysts at Thomson Reuters/Verus upgraded shares of Caterpillar from a “sell” rating to a “hold” rating in a research note to investors on Monday. Finally, analysts at Longbow Research reiterated a “buy” rating on shares of Caterpillar in a research note to investors on Friday, October 18th. One research analyst has rated the stock with a sell rating, fifteen have issued a hold rating and nine have assigned a buy rating to the company’s stock. The company has a consensus rating of “Hold” and an average price target of $91.35.
Caterpillar Inc (NYSE:CAT) is a manufacturer of construction and mining equipment, diesel and natural gas engines, industrial gas turbines and diesel-electric locomotives.
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