Core Viewpoint - Caterpillar has shown significant stock performance, with an 83% increase over the last three years and 176% over the last five years, but investors should consider the cyclical nature of the company and its current market conditions before making investment decisions [1]. Group 1: Company Overview - Caterpillar operates in cyclical markets, primarily in construction, resource industries, and energy and transportation [2]. - Recent years have seen strong performance in these end markets, supported by solid commercial construction, bipartisan infrastructure spending, and favorable commodity prices [3]. Group 2: Financial Performance and Projections - Management estimates that free cash flow (FCF) for 2024 will range from $5 billion to $10 billion, indicating a peak in the current cycle [4]. - The projected FCF for 2025 is between $7.5 billion and $10 billion, suggesting a potential market cap of $175 billion based on a typical price-to-FCF multiple of 20 [5][6]. - If the current cycle has peaked, a more cautious estimate would place FCF at $7.6 billion, leading to a market cap of $150 billion [7]. Group 3: Services Growth - In 2024, Caterpillar generated $64.8 billion in sales, with $24 billion from services, marking a 4% increase from 2023 [8]. - The company aims to double its services revenue from $14 billion in 2016 to $28 billion by 2026, requiring an annual growth rate of 8% [9]. Group 4: Pricing Environment - Price realization, which reflects the ability to achieve listed selling prices, has turned negative in the fourth quarter of 2024, indicating a weakening pricing environment [10][11]. - This trend suggests that pricing pressures are impacting sales volume, which could affect overall profitability [11]. Group 5: Investment Outlook - Currently, Caterpillar does not appear to be an outstanding value stock, but future economic conditions could change this outlook [12]. - Given the trends in price realization, service revenue growth, and sales volumes, it is likely that Caterpillar has passed the peak of the current cycle, making it a candidate for the watch list [13].

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Two of the Dow Jones Industrial Average's 30 components make for no-brainer buys, while another brand-name member continues to suffer from self-inflicted wounds.For nearly 129 years, the iconic Dow Jones Industrial Average (^DJI 1.14%) has served as a key barometer of Wall Street's health and stability. This index, which began its existence with a dozen mostly industrial components in May 1896, is now home to 30 diverse, time-tested, multinational businesses.But just because the Dow's components have a rich ...

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Core Viewpoint - Berkshire Hathaway is currently valued at $1.11 trillion, making it the seventh most valuable U.S.-based company, despite not being included in the Dow Jones Industrial Average [1][11]. Stock Split Considerations - A potential stock split of Berkshire's Class B shares could enhance its chances of being included in the Dow, as the index is price-weighted and favors companies with lower share prices [2][5]. - The last stock split occurred 15 years ago, and a new split could lower the share price to align with the median price of Dow components, which is around $225 [3][5][6]. - Current trading conditions, such as zero-commission trading and fractional shares, reduce the necessity for a stock split to attract investors [4][11]. Dow Jones Industrial Average Dynamics - The Dow is heavily weighted towards financial sector companies, which collectively account for 25.1% of the index, making it challenging for Berkshire to be included due to potential redundancies with existing components [7][9]. - If Berkshire were to split its stock, it might replace Travelers Companies, but its diverse business operations extend beyond insurance [8][9]. Investment Rationale - The fundamental strength of Berkshire's underlying businesses and its diversification across various markets are the primary reasons to consider it a buy, rather than the potential for a stock split or inclusion in the Dow [12][14]. - Berkshire holds a record high of $334.2 billion in cash and equivalents, providing significant resources for future investments [14][15].

While most of this collection of Dow Industrials is too pricey and reveals only skinny dividends, one of the ten lowest priced Dogs of the Dow is ready to buy. March finds only Verizon ( VZ ), living up toGet All the Dogs Of The Dow Dividend Dogcatcher StoriesClick here to subscribe to The Dividend Dogcatcher & get more information.Catch A Dog On Facebook the evening before every NYSE trade day on Facebook/Dividend Dog Catcher, a Fredrik Arnold live video highlights a portfolio candidate in the Underdog Dai ...

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Core Viewpoint - Home Depot's stock increased by 2.8% despite weak fiscal 2024 results and conservative fiscal 2025 guidance, indicating potential resilience in the face of industry challenges [1] Dividend Growth - Home Depot has historically experienced rapid dividend and earnings growth over the past 15 years, but recent years have shown a slowdown in earnings growth [2][3] - The latest dividend increase of 2.2% is the smallest since 2010, reflecting the company's ongoing downturn [3] - The payout ratio has risen to 60%, higher than the average over the last 15 years, but still considered healthy for an industry leader [4] Earnings Expectations - Home Depot is projecting only 2.8% total sales growth and a 1% increase in comparable sales for fiscal 2025, with diluted EPS expected to decline by 3% [7] - Fiscal 2024 diluted EPS was $14.91, and the expected EPS for fiscal 2025 is $14.94, indicating a stagnation in earnings compared to previous years [8] Market Context - The company's weak performance is attributed to broader industry challenges, including high interest rates and reduced consumer spending, rather than management execution [9][10] - Despite the lack of growth, Home Depot's earnings have not significantly declined, suggesting stability during the cyclical slowdown [11] Long-term Strategy - Home Depot continues to invest in long-term growth opportunities, such as the acquisition of SRS Distribution for $18.25 billion and the opening of 13 new stores in fiscal 2025 [14] - The company is positioned to benefit from a potential recovery in the home improvement industry, making it a viable option for long-term investors [15]

Company Performance - Dow Inc. closed at $38.11, reflecting a decrease of -0.83% from the previous session, underperforming the S&P 500's gain of 1.59% on the same day [1] - Over the past month, shares of Dow Inc. have decreased by 0.31%, while the Basic Materials sector and the S&P 500 have lost 0.27% and 2.42%, respectively [1] Upcoming Earnings - The upcoming earnings per share (EPS) for Dow Inc. is projected at $0.11, indicating an 80.36% decline compared to the same quarter last year [2] - Revenue for the upcoming quarter is estimated at $10.29 billion, which represents a 4.44% decrease from the equivalent quarter last year [2] Fiscal Year Estimates - For the entire fiscal year, earnings are projected at $2.02 per share, reflecting an increase of 18.13%, while revenue is expected to be $42.81 billion, showing a slight decline of 0.36% from the prior year [3] Analyst Estimates and Stock Performance - Recent changes in analyst estimates for Dow Inc. are crucial for investors, as positive revisions can indicate a favorable business outlook [3][4] - The Zacks Rank system, which evaluates estimate changes, currently ranks Dow Inc. at 5 (Strong Sell), indicating a negative outlook [5] Valuation Metrics - Dow Inc. has a Forward P/E ratio of 19.01, which is higher than the industry average of 15.74 [6] - The company also has a PEG ratio of 1.01, aligning with the average PEG ratio of the Chemical - Diversified industry [6] Industry Context - The Chemical - Diversified industry, part of the Basic Materials sector, holds a Zacks Industry Rank of 216, placing it in the bottom 14% of over 250 industries [7] - Historical data shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1 [7]