GE and Caterpillar Race to Create LNP Technology (GE, CAT)

Competition between technology company, General Electric Company (GE) and Caterpillar Inc. (CAT) may become fierce as the two companies race to develop LNG powered models for rail carriers.

The two companies, which are the largest locomotive makers, have been scrambling to develop liquefied natural gas (LNG) powered models as a result of the possible shift from diesel to natural gas.

U.S rail carriers including Berkshire Hathaway Inc. (BRK-A), Burlington Northern Santa Fe LLC (BNI), Union Pacific Corp. (UNP), and Norfolk Southern Corp (NSC) have been working with the companies to attempt to find a way to operate trains on an alternative power. By creating a new technology, expenses for these companies would drop significantly.

Building natural gas powered models would create a whole new level of competition for GE and CAT as
this new technology would completely change the industry by lowering railroad expenses, and reducing greenhouse gas emissions.

General Electric shares were up 17 cents, or 0.72% during premarket trading Friday. The stock has increased 25% in the past year. Caterpillar shares were up 61 cents, or 0.68% during premarket trading Friday. The stock has declined -20% in the past year.

The Bottom Line
Shares of General Electric Company (GE) have a 3.21% yield, based on Thursday’s closing price of $23.68. Shares of Caterpillar Inc. (CAT) have a 2.32% yield, based on Thursday’s closing price of $89.65.

General Electric Company (GE) and Caterpillar Inc. (CAT) are not recommended at this time, holding a DARS™ Ratings of 3.4 and 3.3 out of 5 stars respectively.

Be sure to visit our complete recommended list of the Best Dividend Stocks, as well as a detailed explanation of our ratings system here.

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