by Ian Harvey
July 26, 2017
Here is an overview of Caterpillar Inc. after reporting earnings. This options trade was suggested on Monday, July 24, 2017 with the company reporting the next morning; producing major profits within 24 hours of executing the trades.
Caterpillar Inc. (NYSE:CAT)
Analysts see earnings growth of 31.4% on average for the next five years, and 15.6% year over year for the most recent quarter. The market expects a strong beat, with a whisper number of $1.32 versus the consensus $1.26.
**Option trade to consider: Buy the CAT AUG 18 2017 105.000 CALL at approximately $3.70.
Caterpillar Q2 FY17 earnings amounted to $1.35 per share on a GAAP basis, up from 93 cents per share last year. The company’s GAAP earnings include restructuring costs and gains from its IronPlanet equity investment.
Caterpillar also boosted its full-year revenue outlook to between $42 billion and $44 billion, up from the previous range of $38 billion to $41 billion. It also increased its full-year adjusted earnings guidance to about $5 per share and its GAAP earnings outlook to $3.50 per share at the midpoint. The company said many of its end markets have seen increased demand this year, and it has become more “disciplined” with its cost controls. However, it added that there are still some risks to this guidance, including weak sales in Latin America and the Middle East and risks associated with geopolitics and commodities.
After Caterpillar Q2 FY17 earnings were announced, the equipment company’s stock surged, climbing by as much as 5.88% to $114.54 by end of Tuesday’s trading; up $6.36 from Monday.
Within 24 hours this trade produced a 169% profit!
ACTION TO TAKE
The results say it all!