IB Net Payout Yields Model

Caterpillar: Peak Sales Cycle

Before the open, Caterpillar (CAT) reported monthly sales figures. The data continues to support that this cycle is peaking.

For the 3-month rolling period ending in February, Caterpillar saw global sales grow 33%. Global sales originally reached 34% back in the December period and the growth rate is now trending down.

Investors need to be careful making the mistake of thinking the sales growth rate still high at an impressive 33% rate will send Caterpillar higher. The stock already rallied from around $60 to over $170 leading up to these sales numbers.

The stock hit nearly 50% above the previous all-time high though sales and profits aren't back to peak levels. My previous research highlighted how Caterpillar peaks far prior to reaching peak sales. If anything, the stock got further ahead on the curve this cycle than in the past.

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