Caterpillar Stock Notches New Record After Earnings

Call volume is today running at 19 times the intraday average

Digital Content Manager
Aug 1, 2023 at 10:17 AM
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Caterpillar Inc. (NYSE:CAT) is up 5.9% to trade at a fresh record high of $280.74 at last check, after the blue chip reported a second-quarter earnings and revenue beat. The heavy machinery name warned of lower sales and margins for the current quarter, however, amid rising dealer inventories. 

The equity relied on support from its 40-day moving average since June to contain several pullbacks, while the $256 region recently emerged as a floor. Over the past 12 months, Caterpillar stock added 43.1%.

Analysts are skeptical, with 11 of the 18 in coverage calling the security a "hold" or worse, while the 12-month consensus target price of $243.43 is now a 12.8% discount to current levels. 

The options pits are much more optimistic, per CAT's 50-day call/put volume ratio of 1.60 over at the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX). This ratio ranks higher than 97% of readings from the past year. 

That bullish sentiment is getting reinforced today. So far, 25,000 calls have crossed the tape, or 19 times the intraday average volume, compared to only 8,999 puts. The weekly 8/4 280-strike call is the most popular contract, with new positions being bought to open there.


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