Trade-Ideas: Caterpillar (CAT) Is Today's Pre-Market Laggard Stock

Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link.

Trade-Ideas LLC identified Caterpillar ( CAT) as a pre-market laggard candidate. In addition to specific proprietary factors, Trade-Ideas identified Caterpillar as such a stock due to the following factors:

  • CAT has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $306.2 million.
  • CAT traded 16,649 shares today in the pre-market hours as of 7:36 AM.
  • CAT is down 2.2% today from yesterday's close.

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More details on CAT:

Caterpillar Inc. manufactures and sells construction and mining equipment, diesel and natural gas engines, industrial gas turbines, and diesel-electric locomotives worldwide. The stock currently has a dividend yield of 2.5%. CAT has a PE ratio of 18.8. Currently there are 6 analysts that rate Caterpillar a buy, no analysts rate it a sell, and 12 rate it a hold.

The average volume for Caterpillar has been 3.6 million shares per day over the past 30 days. Caterpillar has a market cap of $69.7 billion and is part of the industrial goods sector and industrial industry. The stock has a beta of 1.65 and a short float of 3.3% with 6.81 days to cover. Shares are up 21.2% year-to-date as of the close of trading on Tuesday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Caterpillar as a buy. The company's strengths can be seen in multiple areas, such as its revenue growth, solid stock price performance, reasonable valuation levels, good cash flow from operations and increase 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.

Highlights from the ratings report include:
  • CAT's revenue growth has slightly outpaced the industry average of 6.2%. Since the same quarter one year prior, revenues slightly increased by 0.2%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • Investors have apparently begun to recognize positive factors similar to those we have mentioned in this report, including earnings growth. This has helped drive up the company's shares by a sharp 25.84% over the past year, a rise that has exceeded that of the S&P 500 Index. Regarding the stock's future course, although almost any stock can fall in a broad market decline, CAT should continue to move higher despite the fact that it has already enjoyed a very nice gain in the past year.
  • The net income growth from the same quarter one year ago has exceeded that of the S&P 500 and the Machinery industry average. The net income increased by 4.8% when compared to the same quarter one year prior, going from $880.00 million to $922.00 million.
  • Net operating cash flow has increased to $1,897.00 million or 33.21% when compared to the same quarter last year. The firm also exceeded the industry average cash flow growth rate of -2.92%.

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.

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