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Caterpillar: Analysts’ Recommendations

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Analysts’ recommendations

Analysts’ interest in Caterpillar (CAT) has remained constant since its third-quarter earnings. Among the 29 analysts tracking Caterpillar, 62% recommended a “buy,” 34% recommended a “hold,” and 4% recommended a “sell.”

Overall, analysts’ consensus on Caterpillar has indicated a target price of $156, which implies a return potential of 14.6% over the closing price on January 24. In the past three months, analysts have reduced Caterpillar’s target price from $160 to $156.

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Caterpillar posted strong third-quarter earnings. The company reported an adjusted EPS of $2.86 and beat analysts’ expectations of $2.85 per share. The company maintained its fiscal adjusted EPS guidance of $11.0–$12.0. As a result, most of the analysts have recommended to “buy” or “hold” the stock.

Brokerages’ recommendations

  • Credit Suisse (CS) rated Caterpillar as “outperform.” Credit Suisse lowered the target price to $173 from $183, which implies a return potential of 30% over the closing price as of January 24.
  • Morgan Stanley (MS) rated Caterpillar as a “buy” and recommended a target price of $169, which implies a return potential of 27.3% over the closing price as of January 24.
  • Barclays (BCS) rated Caterpillar as a “hold.” Caterpillar didn’t recommend a target price.

Investors could hold Caterpillar indirectly by investing in the Invesco Dow Jones Industrial Average Dividend ETF (DJD). DJD has invested 3.2% of its portfolio in Caterpillar stock as of January 24.

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