Caterpillar (CAT): Stock of the Day

This morning, Caterpillar (CAT) reported earnings that beat estimates on the bottom line by a very wide margin ($.72 vs. $.22), but reported top line figures below estimates just under $1 billion ($7.98 vs. $8.86).

This becoming a common theme where companies are beating on the bottom line, but revenues are coming in short of expectations. You would think that revenue growth would / should be an important factor in calculating share price!

They rose their full year forecast to $1.15 to $2.25 per share, above current estimates of $1.13. You can read the full report here at Bloomberg.

Caterpillar will be the stock of the day. It is currently up about 12% in pre-market action. Yesterday, it closed up 7.83%. Jim Cramer mentioned owning this yesterday on his evening Mad Money show on CNBC.

I do not own shares in this, and will not be chasing today. It has had an enormous run, and it is around resistance levels. I would like to see it come back to around the 32.50 - 35 level before contemplating entry.

As you can see in the charts below, there is a 50 SMA on the weekly chart at 38.65 level. There is also a 38.2 Fibonacci retracement (from high to low) around the 44 level. Finally, there is resistance around the 40.50 level.

I will be patient, and wait for this to pullback. This will be the hardest part; doing nothing!

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