Caterpillar (NYSE:CAT) Shares Gap Down – Should You Sell?

Caterpillar Inc. (NYSE:CAT) shares gapped down before the market opened on Thursday . The stock had previously closed at $393.23, but opened at $373.50. Caterpillar shares last traded at $377.04, with a volume of 701,288 shares changing hands.

Analysts Set New Price Targets

A number of research analysts have weighed in on CAT shares. Morgan Stanley reduced their price target on shares of Caterpillar from $330.00 to $300.00 and set an “underweight” rating on the stock in a research report on Friday. JPMorgan Chase & Co. decreased their price objective on shares of Caterpillar from $515.00 to $490.00 and set an “overweight” rating for the company in a report on Friday. StockNews.com downgraded shares of Caterpillar from a “buy” rating to a “hold” rating in a research report on Friday, January 17th. UBS Group boosted their price target on shares of Caterpillar from $295.00 to $355.00 and gave the stock a “sell” rating in a research report on Tuesday. Finally, Jefferies Financial Group upped their price objective on shares of Caterpillar from $455.00 to $475.00 and gave the company a “buy” rating in a research note on Friday, December 6th. Three equities research analysts have rated the stock with a sell rating, eight have given a hold rating and seven have issued a buy rating to the company’s stock. Based on data from MarketBeat.com, the company has a consensus rating of “Hold” and a consensus target price of $380.13.

Caterpillar Stock Performance

The stock has a market capitalization of $179.54 billion, a P/E ratio of 17.24, a P/E/G ratio of 2.05 and a beta of 1.13. The stock has a 50 day simple moving average of $381.40 and a two-hundred day simple moving average of $370.82. The company has a quick ratio of 0.86, a current ratio of 1.40 and a debt-to-equity ratio of 1.33.

Caterpillar (NYSE:CAT) last issued its quarterly earnings results on Thursday, January 30th. The industrial products company reported $5.14 EPS for the quarter, topping analysts’ consensus estimates of $4.97 by $0.17. Caterpillar had a return on equity of 59.09% and a net margin of 16.26%. On average, equities analysts forecast that Caterpillar Inc. will post 21.71 EPS for the current fiscal year.

Caterpillar Announces Dividend

The firm also recently disclosed a quarterly dividend, which will be paid on Thursday, February 20th. Investors of record on Tuesday, January 21st will be issued a $1.41 dividend. The ex-dividend date of this dividend is Tuesday, January 21st. This represents a $5.64 dividend on an annualized basis and a yield of 1.52%. Caterpillar’s dividend payout ratio (DPR) is presently 26.15%.

Insider Buying and Selling

In other Caterpillar news, insider Cheryl H. Johnson sold 2,664 shares of the firm’s stock in a transaction on Monday, November 4th. The shares were sold at an average price of $378.84, for a total value of $1,009,229.76. Following the transaction, the insider now directly owns 12,951 shares of the company’s stock, valued at approximately $4,906,356.84. This trade represents a 17.06 % decrease in their ownership of the stock. The transaction was disclosed in a filing with the Securities & Exchange Commission, which is accessible through this hyperlink. Also, Director Daniel M. Dickinson sold 1,300 shares of the stock in a transaction that occurred on Wednesday, November 6th. The shares were sold at an average price of $418.00, for a total value of $543,400.00. Following the sale, the director now directly owns 4,976 shares of the company’s stock, valued at $2,079,968. The trade was a 20.71 % decrease in their ownership of the stock. The disclosure for this sale can be found here. Insiders sold a total of 32,900 shares of company stock valued at $13,111,601 in the last three months. Insiders own 0.29% of the company’s stock.

Hedge Funds Weigh In On Caterpillar

A number of institutional investors have recently added to or reduced their stakes in CAT. Capital Performance Advisors LLP bought a new stake in shares of Caterpillar in the 3rd quarter valued at about $36,000. Retirement Wealth Solutions LLC bought a new stake in Caterpillar in the 4th quarter worth $34,000. Kimelman & Baird LLC raised its stake in shares of Caterpillar by 42.9% during the third quarter. Kimelman & Baird LLC now owns 100 shares of the industrial products company’s stock valued at $39,000 after acquiring an additional 30 shares during the last quarter. Albion Financial Group UT grew its position in shares of Caterpillar by 334.8% in the 4th quarter. Albion Financial Group UT now owns 100 shares of the industrial products company’s stock worth $36,000 after buying an additional 77 shares during the last quarter. Finally, Trivant Custom Portfolio Group LLC lifted its stake in Caterpillar by 130.0% in the fourth quarter. Trivant Custom Portfolio Group LLC now owns 115 shares of the industrial products company’s stock worth $42,000 after acquiring an additional 65 shares during the period. 70.98% of the stock is currently owned by institutional investors.

About Caterpillar

Caterpillar Inc manufactures and sells construction and mining equipment, off-highway diesel and natural gas engines, industrial gas turbines, and diesel-electric locomotives in worldwide. Its Construction Industries segment offers asphalt pavers, compactors, road reclaimers, forestry machines, cold planers, material handlers, track-type tractors, excavators, telehandlers, motor graders, and pipelayers; compact track, wheel, track-type, backhoe, and skid steer loaders; and related parts and tools.