Monday, July 20, 2009

CAT - Recent News (Opanowski)

Caterpillar Incorporated was up 7.83% on July 20th, on the news that Bank of America-Merrill Lynch has upgraded CAT to a "buy."

Bank of America-Merrill Lynch stated that the end of the second quarter could possibly mark the bottom of the construction sector.

Also, CAT is up 8.73% as of 3:30 PM EST, July 21 on some recent news put out by management. Although CAT's second-quarter profits were down a dramatic $1.14 per share from Q2 2008 to Q2 2009 at $0.60 per share, management has updated their outlook for the remainder of 2009. Management says that it is very satisfied with the results of the various cost cutting strategies they have been implementing for the past several months and feels confident in the way they have steered the company through the recession and is optimistic going forward.

The updated sales and revenue range for 2009 is $32 billion to $36 billion and the profit per share range is $1.15 to $2.25.

Some concerns I have that still need to be addressed are whether demand for their products is going to increase anytime soon and how much the new cap-and-trade policy will affect CAT.

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