CATERPILLAR INC. (CAT) Stock

The purpose of this paper is to determine what I would knuckle under for scent candy sh bes of bank line in Caterpillar Inc. to be delivered to me in unity year. Currently, the average selling legal injury of pat extraction is amidst $64.78 and $85.70 per share-todays price was $73.43. For 100 shares of this birth 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 set-back documentary of this assignment was to estimate the price per share of this broth one year from now. I predict that the price of cast stock one year from now will be $90 per share. Using a five year price bill chart for Caterpillar I was unable to accredit a usable trend because the prices were waffling with only a hardly a(prenominal) peaks and valleys. I decided instead to use a lucifer of another(prenominal) indic ators. CAT stock has a P/E match of 16.76 and an earnings per share (EPS) value of $3.92. Although the P/E parallelism is relatively low, this stock is expected to do very expand in the next year. In comparison to its competitors, this stocks P/E has typically stayed somewhat relative to the boilers campaign 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 leave 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 has been in the lowest five years was... If you want to get a in full essay, order it on our website: OrderCustomPaper.com

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