Caterpillar was removed from our US model portfolio back in September last year. The lower high formation was punctuated last night following the weaker-than-expected quarterly earnings guidance.
The company pointed to tariffs and a slow down in China as major factors in its disappointing fourth-quarter result.
Revenue for the quarter was up 11% to US$14.34bn and adjusted earnings came in at US$2.55 per share.
Caterpillar said it now expects 2019 profit to increase to a range of $11.75 to $12.75 per share.
The results were largely below street estimates, which explains the 9% sell-off in the stock.
We’ll wait for the next Algo Engine buy signal before building a new position in CAT.