In this video, Motley Fool industrials analyst Blake Bos outlines two reasons to buy, and one compelling reason to sell, Caterpillar. One reason to buy is that the company sells at a low multiple and has the potential of a macroeconomic slowdown built into the stock price. That is, downside risk is limited. Another reason to buy is that Caterpillar has made a series of acquisitions expanding its market reach. However, this is also the reason to sell since integration of these acquisitions has not always gone smoothly. Caterpillar needs to gain synergies from its acquisitions and expand its international presence to do well in the future.
Blake Bos has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.