Caterpillar faces a federal grand-jury investigation regarding cash transfers among Caterpillar Inc.’s U.S. and other foreign subsidiaries. More specifically, Caterpillar is accused of moving 85% of its parts sales to a subsidiary in Switzerland. At the same time, only 65 of over 8,000 parts employees work in Switzerland.

There has previously been criticism of Caterpillar’s tax strategy. Last year, a congressional report said that the Illinois-based company has avoided paying a total of $2.4 billion in U.S. taxes since the year 2000 by shifting profits overseas.

Investor Notes:

  • CAT has seen a sharp selloff in recent days
  • Pessimism about the near in the Oil & Gas and mining industries have hit CAT shareholders hard
  • Increasingly low commodity prices have hurt the company’s sales even further
  • Earnings per share (EPS) are forecasted to decline in 2015