Dow Today: International Business Machines (IBM) Leads The Day Higher, Caterpillar (CAT) Lags

Editor's Note: TheStreet ratings do not represent the views of TheStreet's staff or its contributors. Ratings are established by computer based on metrics for performance (which includes growth, stock performance, efficiency and valuation) and risk (volatility and solvency). Companies with poor cash flow or high debt levels tend to earn lower ratings in our model.

The Dow Jones Industrial Average (^DJI) closed up 100 points (+0.8%) at 13,157. During the day, 432.8 million shares of the 30 Dow components have changed hands vs. an average daily trading volume of 661.9 million. The NYSE advances/declines ratio closed at 1,893 issues advancing vs. 1,039 declining with 164 unchanged.

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The Dow component that led the way higher today was International Business Machines (NYSE:IBM), which sported a $2.07 gain (+1.1%) bringing the stock to $197.77. This single gain is lifting the Dow Jones Industrial Average by 15.67 points or roughly accounting for 15.7% of the Dow's overall gain. Volume for International Business Machines ended the day at 2.6 million shares traded vs. an average daily trading volume of 4.1 million shares.

International Business Machines has a market cap of $227.45 billion and is part of the technology sector and computer hardware industry. Shares are up 7.3% year to date as of Thursday's close. The stock's dividend yield sits at 1.7%.

International Business Machines Corporation provides information technology (IT) products and services worldwide. The company operates in five segments: Global Technology Services, Global Business Services, Software, Systems and Technology, and Global Financing. The company has a P/E ratio of 14.4, below the average computer hardware industry P/E ratio of 14.5 and below the S&P 500 P/E ratio of 17.7.

TheStreet Ratings rates International Business Machines as a buy. The company's strengths can be seen in multiple areas, such as its increase in stock price during the past year, growth in earnings per share, increase in net income, notable return on equity and expanding profit margins. We feel these strengths outweigh the fact that the company has had generally high debt management risk by most measures that we evaluated.

• You can view the full International Business Machines Ratings Report.

Holding the Dow back today was Caterpillar (NYSE:CAT), which lagged the broader Dow index with a 16-cent decline (-0.2%) bringing the stock to $87.47. Volume for Caterpillar ended the day at 4.9 million shares traded vs. an average daily trading volume of 7.6 million shares.

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Caterpillar has a market cap of $56.98 billion and is part of the conglomerates sector and conglomerates industry. Shares are down 2.1% year to date as of Thursday's close. The stock's dividend yield sits at 2.3%.

Caterpillar Inc. manufactures and sells construction and mining equipment, diesel and natural gas engines, industrial gas turbines, and diesel-electric locomotives worldwide. The company has a P/E ratio of 9.9, above the average conglomerates industry P/E ratio of 9.8 and below the S&P 500 P/E ratio of 17.7.

TheStreet Ratings rates Caterpillar as a buy. The company's strengths can be seen in multiple areas, such as its robust revenue growth, notable return on equity, impressive record of earnings per share growth and compelling growth in net income. We feel these strengths outweigh the fact that the company has had generally high debt management risk by most measures that we evaluated.

• You can view the full Caterpillar Ratings Report.

 

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