-Stock Near 52-week low; investors hate it but that’s the opportunity

-Rebounding global growth in 2020 should expand P/E, boost shares sharply

-Lower interest rates and weak USD a potential tailwind

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Caterpillar is the poster child for companies damaged by the new tariff regime introduced by President Donald Trump. It’s the whipping boy for investors worried by slowing global growth. In other words, trade good but tariffs bad for CAT. According to FactSet, companies which get 50% of sales outside the U.S.—like CAT—are underperforming the Standard & Poor’s 500 index, on concerns in the market about the impact of the stronger U.S. dollar, slower global economic growth, and trade tensions.

Clearly, CAT is just not a much-liked stock right now.  And that always gets me interested. The stock is down 6% this year, to $120 per share, and 30% from the $171 high in January, 2018. That poor performance accelerated after CAT reported flat and disappointing second quarter earnings July 24. EPS for the first six months was $6.14 compared to $5.65 in the year ago period.

Perhaps most importantly to investors was that this giant and global maker of construction, mining and energy machinery (with $55 billion in sales last year) guided to the lower end of it...
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