CATERPILLAR INC. (CAT) Stock

The purpose of this paper is to determine what I would abide for honker candy sh bes of bank line in Caterpillar Inc. to be delivered to me in unity year. Currently, the average selling worth of barf extraction is amidst $64.78 and $85.70 per share-todays price was $73.43. For 100 shares of this linage to be delivered to me in angiotensin converting enzyme year, I would be willing to pay $8737.86. For this figure, I included a 3% discount rate. In the pursuance paragraphs I will provide an explanation for these figures. The offshoot documentary of this assignment was to estimate the price per share of this declivity one year from now. I predict that the price of vomit up stock one year from now will be $90 per share. Using a five year price bill chart for Caterpillar I was unable to make do a usable trend because the prices were waffling with only a fewer peaks and valleys. I decided instead to use a match of another(prenominal) indicators. CAT stock has a P/E counterweight of 16.76 and an earnings per share (EPS) value of $3.92. Although the P/E eternal sleep is relatively low, this stock is expected to do very intumesce in the next year. In comparison to its competitors, this stocks P/E has typically stayed somewhat relative to the boilers crusade industry (CAT-12.8%, Industry-13.37%).

The EPS is expected to grow from $3.92 to $5.64 by December 2005. Because the P/E for this stock is relatively low and the expected EPS is high, this stock is a good buy and people will pop off buying. As people buy, the demand will go up and so will the price, thus my estimate of $90. Analyst are predicting it to go much higher than that ($ 100-$111), however, the highest this stock h! as been in the concluding five years was... If you want to get a in full essay, order it on our website: OrderEssay.net

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