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Slip of the CAT Got Your Forked Tongue? (CAT)

Posted on March 3, 2021

We’re trucking today on the back of Dow component and global earth-moving champions Caterpillar Inc. (NYSE:CAT), a company that may have nine lives and always lands on its feet, but is sure enough destined for a tumble in the near term.

CAT stock is up better than 25% in just a month, but that has very little to do with the numbers.

Instead, investors seem to be looking forward to an anticipated, post-Batflu economic rebound, in which a great many benefits would certainly accrue to the company.

It’s a rebound, however, that we hate to admit we just don’t see.

Consider the following –

  • The stock’s P/E is 40.6,
  • It’s dividend yield is 1.87% (somewhat redeeming, yes),
  • It trades with a P/B of 7.67 (!),
  • Debt to Equity is a knee-slapping 2.42,
  • EPS this last year is a huge negative 49%,
  • Sales for the past five years are negative 30%
  • Q/Q sales are negative 50%, and
  • Q/Q EPS are negative 35%.

Yet things are looking up?  Stock up 250% in a year?

Come on, gang.

On hopes for the future…?

This thing’s priced for perfection in a Shangri-la la-la land.

Give yer head a shake!

Look at the chart –

And you can tailor it purr-fectly to your needs, tiger.

Many happy returns,

Matt McAbby

 

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