I think you will see it split in the summer around june or july. If it makes it to $120 or $140, then it will be around $70 after the split. My opionion of course, how really knows for sure, but I can tell you it will never see $200 because that is too expensive and Cat doesn't want the stock to become unattractive which at that price is what would happen.
Their history is splitting in the low 100s through a 100% dividend. I can live with that. If if it gets to the 120s I'd see a split as probable. A 60 pps for CAT opens the door to more buyers.
According to split history, most splits have occured in the summer. Just going to have to wait and see. But I seriously doubt Cat will make it to $200 a share. The new trucks will help build the companies bottom line, but Cat wants this stock affordable. $200 a share is not that attractive of a price.
CAT stock up, possible split in shares' future
StoryDiscussionCAT stock up, possible split in shares' future
By TONY REID - H&R Staff Writer Herald-Review.com | Posted: Friday, February 18, 2011 12:00 am | No Comments Posted
Font Size:Default font sizeLarger font size.DECATUR — Speculation is growing that Caterpillar Inc.'s white-hot share price may mean the stock is about to split.
The recent runup on Wall Street has seen the shares cruise past $100 each — they hit $103.36 at the close of business Thursday — and the Peoria-based company has a history of announcing stock splits when the price moves relentlessly upward; Caterpillar stock in February 2010 traded at about $50 a share.
What does a stock split mean, and why do companies do it? In a typical two-for-one split, the company issues an extra share for every share already held: if you had 20 shares, you now own 40.
Stock splits lower the price per share and make those shares more attractive to investors. The split does not affect the market capitalization of the company, which remains the same, even though on paper at least the share value just got halved.
Caterpillar charts the history of its stock split personality on its Web site, which lists nine occasions going back to 1926 when the shares underwent fission. And while spokesman Jim Dugan said the company was aware of the latest market chatter about its stock and had received many media calls on it, Caterpillar preferred not to join the discussion.
“Those decisions (on stock splits) are made by the board, and we don’t speculate about it,” he added. “There are regularly scheduled board meetings, and a wide variety of important issues related to the business are discussed at every meeting.”
Stock splits can be an important issue with investors because they tend to indicate a company’s faith in the upward trajectory of its share price and prospects, and flag the potential for more growth. Caterpillar, buoyed by the sales of the giant mining trucks it builds in Decatur, closed the books on 2010 with a 202 percent jump in year-over-year profits that came in at $2.7 billion. Sales and revenues in 2010 were more than $42 billion, up 31 percent over 2009.
Jim Minton, an investment adviser with Decatur-based Investment Planners Inc., said stock splits were a great way for companies to draw attention to themselves and how well they’re doing. He said analysts are looking for the company to earn $7.50 a share in 2012, which, using a price-earnings ratio of 20 (a way to calculate valuation) gave a projected price of $150 a share.
Minton believes a split is in the offing, and he said it would be a good opportunity for stockholders to make some money. “Generally, you get a little price appreciation when a split happens … and depending upon your allocation, that might be a time to sell a few shares into the good news,” he said.
<<<Stocks don't seem to be splitting anymore>>>.
My guess is that some companies whose stock prices has appreciated don't want to split to invite more day traders with there constant flipping.
Futhermore retail holders are a small percentage of the market as the big boyz such as institutions & fund managers (who really move any market) & who have billions in assets and can buy tens or hundreds of millions of dollars in stock really don't care about splits.
Warren Buffet equated splits as changing a 10 for two 5's. No more or less.
With that being said CAT seems like an exception & would not be surpeised that a split will take place within 6 months (maybe sooner) but with the exception of a divedend raise there is no 'increased value' except phycological as stocks acting well split stocks doing bad don't.
AS for helping the retail investors that's a mixed bag as yes it's more affordable for 100 lot buying, many retail investors do sell some shares after a split to bank profits, so again a split is nice but I wonder what the intrinsic value is without an increased divedend with the split.
I honestly couldn't tell you why these companies don't split. I have often wondered the same thing. But I can tell you that Cat isn't like that. They want as many people as possible to be attracted to them. Thats how they get cash flow..
That's only if the company chooses, if you look at their history, not all of them are in the form of 100% stock dividend, but most likely it will be, and your dividend will split the same as the stock.