Caterpillar Stock Market Value
CAT Stock | USD 363.52 0.27 0.07% |
Symbol | Caterpillar |
Caterpillar Price To Book Ratio
Is Caterpillar's industry expected to grow? Or is there an opportunity to expand the business' product line in the future? Factors like these will boost the valuation of Caterpillar. If investors know Caterpillar will grow in the future, the company's valuation will be higher. The financial industry is built on trying to define current growth potential and future valuation accurately. All the valuation information about Caterpillar listed above have to be considered, but the key to understanding future value is determining which factors weigh more heavily than others.
Quarterly Earnings Growth 0.893 | Dividend Share 5.1 | Earnings Share 20.12 | Revenue Per Share 131.336 | Quarterly Revenue Growth 0.029 |
The market value of Caterpillar is measured differently than its book value, which is the value of Caterpillar that is recorded on the company's balance sheet. Investors also form their own opinion of Caterpillar's value that differs from its market value or its book value, called intrinsic value, which is Caterpillar's true underlying value. Investors use various methods to calculate intrinsic value and buy a stock when its market value falls below its intrinsic value. Because Caterpillar's market value can be influenced by many factors that don't directly affect Caterpillar's underlying business (such as a pandemic or basic market pessimism), market value can vary widely from intrinsic value.
Please note, there is a significant difference between Caterpillar's value and its price as these two are different measures arrived at by different means. Investors typically determine if Caterpillar is a good investment by looking at such factors as earnings, sales, fundamental and technical indicators, competition as well as analyst projections. However, Caterpillar's price is the amount at which it trades on the open market and represents the number that a seller and buyer find agreeable to each party.
Caterpillar 'What if' Analysis
In the world of financial modeling, what-if analysis is part of sensitivity analysis performed to test how changes in assumptions impact individual outputs in a model. When applied to Caterpillar's stock what-if analysis refers to the analyzing how the change in your past investing horizon will affect the profitability against the current market value of Caterpillar.
03/26/2024 |
| 04/25/2024 |
If you would invest 0.00 in Caterpillar on March 26, 2024 and sell it all today you would earn a total of 0.00 from holding Caterpillar or generate 0.0% return on investment in Caterpillar over 30 days. Caterpillar is related to or competes with NikolaCorp, Ideanomics, Lion Electric, and Wabash National. Caterpillar Inc. manufactures and sells construction and mining equipment, diesel and natural gas engines, and industria... More
Caterpillar Upside/Downside Indicators
Understanding different market momentum indicators often help investors to time their next move. Potential upside and downside technical ratios enable traders to measure Caterpillar's stock current market value against overall market sentiment and can be a good tool during both bulling and bearish trends. Here we outline some of the essential indicators to assess Caterpillar upside and downside potential and time the market with a certain degree of confidence.
Downside Deviation | 1.29 | |||
Information Ratio | 0.2161 | |||
Maximum Drawdown | 6.21 | |||
Value At Risk | (1.71) | |||
Potential Upside | 2.46 |
Caterpillar Market Risk Indicators
Today, many novice investors tend to focus exclusively on investment returns with little concern for Caterpillar's investment risk. Other traders do consider volatility but use just one or two very conventional indicators such as Caterpillar's standard deviation. In reality, there are many statistical measures that can use Caterpillar historical prices to predict the future Caterpillar's volatility.Risk Adjusted Performance | 0.185 | |||
Jensen Alpha | 0.2535 | |||
Total Risk Alpha | 0.1901 | |||
Sortino Ratio | 0.2208 | |||
Treynor Ratio | 0.2696 |
Sophisticated investors, who have witnessed many market ups and downs, anticipate that the market will even out over time. This tendency of Caterpillar's price to converge to an average value over time is called mean reversion. However, historically, high market prices usually discourage investors that believe in mean reversion to invest, while low prices are viewed as an opportunity to buy.
Caterpillar Backtested Returns
Caterpillar appears to be very steady, given 3 months investment horizon. Caterpillar secures Sharpe Ratio (or Efficiency) of 0.25, which signifies that the company had a 0.25% return per unit of risk over the last 3 months. We have found twenty-nine technical indicators for Caterpillar, which you can use to evaluate the volatility of the firm. Please makes use of Caterpillar's Downside Deviation of 1.29, risk adjusted performance of 0.185, and Mean Deviation of 1.04 to double-check if our risk estimates are consistent with your expectations. On a scale of 0 to 100, Caterpillar holds a performance score of 19. The firm shows a Beta (market volatility) of 1.38, which signifies a somewhat significant risk relative to the market. As the market goes up, the company is expected to outperform it. However, if the market returns are negative, Caterpillar will likely underperform. Please check Caterpillar's value at risk, as well as the relationship between the skewness and day median price , to make a quick decision on whether Caterpillar's price patterns will revert.
Auto-correlation | -0.76 |
Almost perfect reverse predictability
Caterpillar has almost perfect reverse predictability. Overlapping area represents the amount of predictability between Caterpillar time series from 26th of March 2024 to 10th of April 2024 and 10th of April 2024 to 25th of April 2024. The more autocorrelation exist between current time interval and its lagged values, the more accurately you can make projection about the future pattern of Caterpillar price movement. The serial correlation of -0.76 indicates that around 76.0% of current Caterpillar price fluctuation can be explain by its past prices.
Correlation Coefficient | -0.76 | |
Spearman Rank Test | 0.07 | |
Residual Average | 0.0 | |
Price Variance | 27.09 |
Caterpillar lagged returns against current returns
Autocorrelation, which is Caterpillar stock's lagged correlation, explains the relationship between observations of its time series of returns over different periods of time. The observations are said to be independent if autocorrelation is zero. Autocorrelation is calculated as a function of mean and variance and can have practical application in predicting Caterpillar's stock expected returns. We can calculate the autocorrelation of Caterpillar returns to help us make a trade decision. For example, suppose you find that Caterpillar has exhibited high autocorrelation historically, and you observe that the stock is moving up for the past few days. In that case, you can expect the price movement to match the lagging time series.
Current and Lagged Values |
Timeline |
Caterpillar regressed lagged prices vs. current prices
Serial correlation can be approximated by using the Durbin-Watson (DW) test. The correlation can be either positive or negative. If Caterpillar stock is displaying a positive serial correlation, investors will expect a positive pattern to continue. However, if Caterpillar stock is observed to have a negative serial correlation, investors will generally project negative sentiment on having a locked-in long position in Caterpillar stock over time.
Current vs Lagged Prices |
Timeline |
Caterpillar Lagged Returns
When evaluating Caterpillar's market value, investors can use the concept of autocorrelation to see how much of an impact past prices of Caterpillar stock have on its future price. Caterpillar autocorrelation represents the degree of similarity between a given time horizon and a lagged version of the same horizon over the previous time interval. In other words, Caterpillar autocorrelation shows the relationship between Caterpillar stock current value and its past values and can show if there is a momentum factor associated with investing in Caterpillar.
Regressed Prices |
Timeline |
Pair Trading with Caterpillar
One of the main advantages of trading using pair correlations is that every trade hedges away some risk. Because there are two separate transactions required, even if Caterpillar position performs unexpectedly, the other equity can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Caterpillar will appreciate offsetting losses from the drop in the long position's value.Moving against Caterpillar Stock
0.88 | TWI | Titan International Earnings Call This Week | PairCorr |
0.85 | LNN | Lindsay Financial Report 4th of July 2024 | PairCorr |
0.82 | LEV | Lion Electric Corp Financial Report 14th of May 2024 | PairCorr |
0.8 | ZEVYW | Lightning eMotors | PairCorr |
0.72 | MNTX | Manitex International Earnings Call This Week | PairCorr |
The ability to find closely correlated positions to Caterpillar could be a great tool in your tax-loss harvesting strategies, allowing investors a quick way to find a similar-enough asset to replace Caterpillar when you sell it. If you don't do this, your portfolio allocation will be skewed against your target asset allocation. So, investors can't just sell and buy back Caterpillar - that would be a violation of the tax code under the "wash sale" rule, and this is why you need to find a similar enough asset and use the proceeds from selling Caterpillar to buy it.
The correlation of Caterpillar is a statistical measure of how it moves in relation to other instruments. This measure is expressed in what is known as the correlation coefficient, which ranges between -1 and +1. A perfect positive correlation (i.e., a correlation coefficient of +1) implies that as Caterpillar moves, either up or down, the other security will move in the same direction. Alternatively, perfect negative correlation means that if Caterpillar moves in either direction, the perfectly negatively correlated security will move in the opposite direction. If the correlation is 0, the equities are not correlated; they are entirely random. A correlation greater than 0.8 is generally described as strong, whereas a correlation less than 0.5 is generally considered weak.
Correlation analysis and pair trading evaluation for Caterpillar can also be used as hedging techniques within a particular sector or industry or even over random equities to generate a better risk-adjusted return on your portfolios.Check out Caterpillar Correlation, Caterpillar Volatility and Caterpillar Alpha and Beta module to complement your research on Caterpillar. For more information on how to buy Caterpillar Stock please use our How to Invest in Caterpillar guide.Note that the Caterpillar information on this page should be used as a complementary analysis to other Caterpillar's statistical models used to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
Complementary Tools for Caterpillar Stock analysis
When running Caterpillar's price analysis, check to measure Caterpillar's market volatility, profitability, liquidity, solvency, efficiency, growth potential, financial leverage, and other vital indicators. We have many different tools that can be utilized to determine how healthy Caterpillar is operating at the current time. Most of Caterpillar's value examination focuses on studying past and present price action to predict the probability of Caterpillar's future price movements. You can analyze the entity against its peers and the financial market as a whole to determine factors that move Caterpillar's price. Additionally, you may evaluate how the addition of Caterpillar to your portfolios can decrease your overall portfolio volatility.
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Caterpillar technical stock analysis exercises models and trading practices based on price and volume transformations, such as the moving averages, relative strength index, regressions, price and return correlations, business cycles, stock market cycles, or different charting patterns.