Weather Forecast

Close

Business

Caterpillar picks up an 'overweight' from Barclays

Barclays has upgraded Caterpillar to "overweight" from "equal weight" on Tuesday, saying the company's revenues are at "record-depressed levels."
Investors likely will never see a chance to buy CAT revenues with as much upside as in 2017," analysts write in note. The upgrade was spurred by analysts' belief that several of CAT's end markets are due for recovery, notably the mining aftermarket, mining replacement and China construction.

A raised price target on stock from $100 to $110 implyies a greater than 18 percent upside to current levels, analysts said, although CAT in a maintained negative industry view. The valuation is based on a 20x estimated 2018 earnings per share of $5.50, which is well above the $4.35 consensus.

Currently, there are eight of 26 brokers rating CAT as a "buy" equivalent or higher, according to the report. Another 14 are raring CAT as a hold stock and four more give it a sell status. The median price target for CAT is $96.50, up from $91.50 a month ago.

CAT stock has fallen 5.4 percent since the company released its 2017 forecast on Jan. 26. The profit is sharply below expectations as restructuring continues, analysts say.

CAT closed Monday at $92.87, up 10 percent since the U.S. election on Nov 8. The CAT stock had since rallied on President Donals Trump's promises of increased infrastructure spending.

Advertisement
randomness