Dividend Growth Forum

Caterpillar

Global machinery giant Caterpillar earn $1.61 per share on an adjusted basis, which was much stronger than the $1.23 expected by analysts.

Management also raised earnings guidance.

I bought CAT in December and it is up 20%+ since then.

I've not spent much time looking at CAT. How do they stack up as a dividend growth prospect?

Good question

I bought in early December after a poor quarterly report lowered the price, and got in with a 2.8% yield. With the current yield, 3.3%, they would not even be in the universe of stocks I would consider.

Their 3 year DGR is close to 10%, their 3 year in the mid 7% range. The most recent increase was 15%, from .52 to .60 a quarter.

A dividend increase announcement is due before too long as the May dividend will be the fourth one at .60.

It is a cyclical company and I do not consider it a core position, but that does. to mean I am looking to take profits on it. With an improving world economy CAT could do well over the next few years.