CFRA, an independent research provider, has provided MT Newswires with the following research alert. Analysts at CFRA have summarized their opinion as follows:
CAT shares have risen 65% from the end of October 2023 to a record of ~$375 per share. We now view CAT shares as fully valued following the recent run-up, and see there being less room to run given our outlook for low single-digit EPS expansion in 2024 and 2025. We believe the strong share performance can be tied to anticipated tailwinds in 2024, including government-led infrastructure investments, recovering residential construction activity, AI-driven data center buildout, and positive impacts from expected interest rate cuts. However, we view the near-term opportunity from these growth catalysts currently being baked into share price. China (typically 5%-10% of enterprise sales) poses a near-term headwind for CAT as economic conditions remain unfavorable, although a stronger-than-anticipated recovery would likely support stronger than forecasted sales and earnings growth. Our 12-month target of $360 values shares at 16.1x our 2025 EPS outlook of $22.35 (2024 EPS kept at $21.41).