Caterpillar (CAT) Receives a Hold from Oppenheimer

By Ryan Adsit

In a report released today, Noah Kaye from Oppenheimer maintained a Hold rating on Caterpillar (CATResearch Report). The company’s shares closed on Tuesday at $129.32.

Kaye commented:

“We recently met with Tom Bucklar, director of Hohulin, IR manager at CAT’s headquarters. Per our initiation, we view CAT’s external digital strategy—the result of a decade-long shift to focus on customer value creation—as an increasingly vital enabler of its market/price leadership and lever to reduce earnings volatility. Meanwhile, management remains generally positive on end-markets trajectory into FY19 and expects price to fairly offset cost increases (including tariffs). Previously discussed margin puts/takes could imply a conservative consensus outlook for FY19 operating leverage. We believe risk/reward on the shares remains challenging in the current market environment, but could see CAT as a leading potential beneficiary of a better-than-feared macro trade in 2019.”

According to TipRanks.com, Kaye is a 4-star analyst with an average return of 3.0% and a 53.1% success rate. Kaye covers the Basic Materials sector, focusing on stocks such as Advanced Disposal Services Inc, Waste Connections Inc, and Republic Services.

Currently, the analyst consensus on Caterpillar is a Moderate Buy with an average price target of $157.82.

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Based on Caterpillar’s latest earnings release for the quarter ending September 30, the company reported a quarterly revenue of $13.51 billion and net profit of $1.73 billion. In comparison, last year the company earned revenue of $11.41 billion and had a net profit of $1.06 billion.

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Caterpillar, Inc. engages in the manufacture of construction and mining equipment, diesel and natural gas engines, industrial gas turbines, and diesel-electric locomotives. It operates through the following segments: Construction Industries, Resource Industries, Energy and Transportation, Financial Products, and All Other.