That is the easy play, ring it and run. but why? that is what all the fragile holders are doing and the easiest way to deal with this issue. accounting shenanigans are a BIG deal and if there are anymore reports of similar misconduct i will bail. But, if china is only 3% of cat's sales, lets call it 5%. so lets pull china out of CAT's stock price and go from there which is way too negative of a base case to begin with. then at 10x forward earnings approx. 10.40(.95) = $9.88 2013 EPS and reduce their revised 2015 guidance to $11.50 - $17.00 still not overpriced IMO. or is this why they lowered guidance over the summer?
The article in my brokerage acct said thet CAT started to look at ERA in october and nailed it in November. At least they didnt own this Co for 5-10 yrs and have had a decade of overjuiced figures.
This last part is purely my own speculation and feel free to rip me a new1 if you think im crazy but any positive input is appreciated.
I feel the market knew this and i truely feel that this has been cooked into the stock on the hush hush til friday. I feel they almost waited til the market had solid sentiment, extended weekend to soften the blow. also could have been the reason that we saw $78 in the summer.
I actually think your right about Cat knowing in advanced but really you can't expect them to act without investigating first !
There are Laws that Corporations are supposed to follow that get broken everyday !
How many times do people get unofficially hired before the interview process even begins ?
Happens everyday in every town !
Sentiment: Strong Buy
Cat will eat the shorts alive in the long run !
Your right Cat is a much bigger Company than just this little deal in China !
Most of these posters are here just because they feed on bad news but they have missed the boat on this one !
Call me naïve, but materially significant information on publically traded companies must be made public when management believes the information to be true. The legal folks were all over this and Oberhelman made the announcement when they knew with certainty what the scope and impact would be. It seems to me they may have well thrown additional money in the number to cover the extra costs of trying to claw back money from the bankers and legal advisors of the acquisition. Writing off 75% of the entire transaction because of fraud at one subsidiary seems extreme to me. We'll see what Doug has to say. There will be pointed questions on the 28th I'm sure.
This is wall street. Crooks run the show and be damned if a accounting scandal is going to stop the march toward higher highs. Look at CMG last week. 30 buck swing on reduced earnings guidance. Remember the sheep are starting to lubricate the money markets. Where does the money go? Blue os so blue. Well in this case yellow.
Just a cynical clowns opinion.
Will be over 100 shortly !
Cats wrote off big numbers before the only thing thats going to determine real direction of stock price is going to be forward guidance !
You will know Tuesday & Wednesday for sure !
I don't think it will get punished like people think it will !
Down 3 - 5 bucks and then back it comes !