Credit Suisse has lowered their price target for construction equipment manufacturer, Caterpillar Inc.(CAT) on Tuesday.
The firm reaffirmed their “Outperform” rating for CAT, but lowered their price target from $117 to $108. This new price target suggests a 22% increase over the stock’s current price of $83.74, and 16% increase over the stock’s YTD price of $90.60.
An analyst from the firm commented, “CAT’s stock held up yesterday on low expectations despite lowering 2012 EPS and providing its first take on 2013, calling for a “flattish” sales year. However, CAT continues to execute, address its inventory issue and, more importantly, maintains its positive view on global growth over the long term, implying 2013 is just a mid-cycle pause. … Despite investor concerns, mining does not appear to be falling apart, noting there haven’t been more material cancellations and calling for 2013 mining capex to be down ~5-10%. We lower our 2012-2015 est.’s to $9.25 (from $9.60), $8.65 (from $10.50), $9.90 (from $11.20) and $11.90.”
Caterpillar shares were down $1.40, or -1.65% on Tuesday afternoon.
The Bottom Line
Shares of Caterpillar (CAT) have a 2.44% dividend yield, based on last night’s closing stock price of $85.08. The stock has technical support in the $79-$80 price area. If the shares can firm up, we see overhead resistance around the $88-$90 price levels.
Caterpillar Inc.(CAT) is not recommended at this time, holding a Dividend.com DARS™ Rating of 3.3 out of 5 stars.
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