Growth opportunities outside of CAT? One look at IBD this year points to a few as an example. Will they do as will in 2012 as they did in 2011 is the question for them as well as CAT.
Time will tell!
Excellent advice. Thank you for the response. You are absolutely correct in advising not to get caught up in the daily gyrations of the market. It's a difficult rule to follow, but one that would probably help my sanity :). Long term, this is a great company. Thanks again!
I have no opinion on short term moves in the market. The near term is pretty much irrational. I have no idea what the headlines will be tomorrow and the near term moves are a function of market sentiment and the high frequency traders. Long term, stock prices follow the profitability of the underlying company. I'm an investor and not a trader. When I scaled in in late '08 - early '09 I made purchases with 30% more downside to follow, $30, and missed the bottom by 100% at $40 on the way up. Didn't bother me a bit. Only the lucky find the absolute bottom. I'm sitting on a triple with more upside to go. So the message is don't worry about a few points now, rather where do you think it will be in two years?
It takes patience and some guts to ignore the short term gyrations and focus on the longer term. The opportunity in October '11 was the time to buy, Cat at $70 was like getting cashmere at burlap prices. But you know that now, hind sight is always 20-20. Will it happen again? Maybe, but CAT is running at full speed, adding capacity and buying profitable complimentary companies. Buy this company and enjoy the long term benefits.
Also, this investment needs to be a part of an overall well diversified financial strategy. I'm a example of being way too concentrated in a single stock and wouldn't recommend that strategy to anybody. But for me right now there are just not many places to put money with the opportunity for growth CAT has.
The market seems in a very forgiving mood thru christmas. Its shrugging off bad news.
Cramer on CNBC says he thinks the sideways market is due to shorts covering who dont want to be short right now.
Any kind of rumor that EU will make a deal, even if nothing happening, or in the US will move stocks higher.
Right now I would call them more drifting than up or down. After the maniac market of late, maybe sideways and give the market time to grow some legs is a good thing?
Where do you think CAT's price is headed in the coming weeks? You think it will break the 98-100 range or do you think it will drop back to 90? Do you think there will be a good entry point in the near future? I share your strong sentiment for this stock, but I am hesitant to buy when economies are in flux and when we could see a large price drop if things do indeed go south.
If you've followed this board for a while you'll know that I'm a long term bull on CAT. I play the years long cycle for CAT. I've followed CAT for 35 years and there is a definite pattern. It clearly follows the world wide economic cycle. I think we're at the end of year 2 of a 5-7 year cycle. My prediction is for CAT to continue to rise as the overall economy improves. So far it's been totally driven by the developing countries. Europe, Japan and the US have not contributed much so far. But even with that, CAT is still enjoying record sales and profits. It appears the US will start to contribute some growth going forward. Europe will suffer for several years yet and Japan is still stuck in the mud. But really that all a positive for CAT. There is so much potential demand for their products that they don't have the capacity to satisfy all the demand simultaneously. Delaying the recovery in the developed countries allows CAT to put the capacity in place. They've announced a minimum of 13 large capital expansion plans around the world and have purchased four complimentary companies is the past couple years.
I'm looking for CAT to continue producing record results, posting a historical PE of 11-13 on an EPS approaching $12+ by 2015.
One concern I have of course is for something to unexpectedly derail the world wide economy. In that case CAT gives it all back in a hurry. When things go south, CAT drops fast. You want to be out of the stock when the Fed starts seriously raising interest rates and the market is all bubbly. Go to cash, wait for it to drop and then get back in again. Patience is the key.
I'm a small time investor, so if I were trading constantly, a couple bad moves here and there would eat up the profits of the good ones through transaction fees. I was more or less curious if you felt another two week drop was in store due to the continued drama with Europe. I have no intentions on selling my position in CAT at this point in time(been long since 86.00 and lowered my margin by buying in again at 73.00 on the dip). However, there are other stocks I'm looking to get out of but would like to time it with an upswing in the market. That being said this is one of the few boards where the people (yourself L2L firefly ben and so on) seem to understand not only CAT but are more experienced with the overall trends in the market than myself.....and that is why I asked
I don't think last week's move was caused by "good" news from Europe as much as it was better news about the US economy and an absence of bad news from across the Atlantic. Consensus is building that the US is going to chug along at 2-3% growth and perhaps unemployment will slowly improve.
I think I've said it before but this is what happens when you try to time the market. Get in with at least half of your capital and stay in. If you want to try to play the rest OK but at least you'll have half comfortably picking up these kind of gains. Cat is going big in '12, if you miss the big individual days you'll miss most of the whole move.