#3 Worst Dow Stock: Caterpillar
In 2011, Caterpillar (NYSE:CAT) posted lackluster losses of 5% compared with 5% gains for the broader Dow Jones Industrial Average. And so far in 2012, CAT is one of the Dow’s worst performers.
The move makes sense at a casual glance — after all, Caterpillar makes heavy machinery for construction and mining. It’s not like there’s booming demand for commercial structures or big spending on infrastructure projects amid debt debates in Washington. As for mining, the low prices for copper and other base metals amid the economic downturn shows that demand just isn’t there.
This is apparently what investors are thinking, and why CAT stock has been held back. However, consider that Caterpillar’s revenue has soared from $32 billion in fiscal 2009 to more than $60 billion in 2011 — with projections of over $70 billion in 2012! Earnings per share also have soared, from a mere $1.43 in 2009 to $7.40 last year and projections of $9.75 in 2012.