Zacks Research Downgrades Caterpillar (NYSE:CAT) to Hold

Key Points

• Zacks Research downgraded Caterpillar from “Strong Buy” to “Hold”, despite issuing 2026–2028 earnings estimates. The broader analyst consensus remains “Moderate Buy,” with 15 Buy ratings, 12 Holds, and an average price target of $989.17.
• Caterpillar reported a strong quarter, posting $8.17 in EPS versus the $6.22 consensus estimate and revenue of $20.54 billion, up 23.7% year over year. Analysts project full-year EPS of approximately $27.42.
• Shares opened at $864.04, giving Caterpillar a market capitalization of about $397.2 billion and a P/E ratio of 37.18. CEO Joseph Creed recently sold 32,401 shares worth roughly $26.2 million, while institutional investors own 70.98% of the stock.

Caterpillar (NYSE:CAT - Get Free Report) was downgraded by stock analysts at Zacks Research from a "strong-buy" rating to a "hold" rating in a research report issued to clients and investors on Monday, Zacks reports. Zacks Research also issued estimates for Caterpillar's Q3 2026 earnings at $6.78 EPS, Q4 2026 earnings at $6.88 EPS, FY2026 earnings at $27.36 EPS, Q1 2027 earnings at $6.48 EPS, Q2 2027 earnings at $8.52 EPS, Q3 2027 earnings at $8.40 EPS, Q4 2027 earnings at $9.04 EPS, FY2027 earnings at $32.44 EPS and Q3 2028 earnings at $10.16 EPS.

A number of other brokerages also recently weighed in on CAT. DA Davidson increased their price target on shares of Caterpillar from $845.00 to $882.00 and gave the company a "neutral" rating in a research report on Thursday, August 6th. Erste Group Bank lowered shares of Caterpillar from a "buy" rating to a "hold" rating in a report on Monday, July 27th. President Capital initiated coverage on shares of Caterpillar in a research report on Friday, September 18th. They set a "buy" rating and a $999.00 price target on the stock. Truist Financial lowered their price objective on shares of Caterpillar from $1,225.00 to $1,100.00 and set a "buy" rating for the company in a research report on Monday. Finally, JPMorgan Chase & Co. raised their price objective on Caterpillar from $1,125.00 to $1,165.00 and gave the stock an "overweight" rating in a research note on Wednesday, June 17th. Fifteen analysts have rated the stock with a Buy rating and twelve have issued a Hold rating to the company's stock. According to MarketBeat.com, the stock presently has a consensus rating of "Moderate Buy" and an average price target of $989.17.

Caterpillar Stock Performance

Shares of Caterpillar stock opened at $864.04 on Monday. The company has a debt-to-equity ratio of 1.65, a current ratio of 1.37 and a quick ratio of 0.85. The firm has a 50 day simple moving average of $822.22 and a 200 day simple moving average of $852.27. Caterpillar has a fifty-two week low of $483.55 and a fifty-two week high of $1,073.46. The firm has a market cap of $397.18 billion, a P/E ratio of 37.18, a P/E/G ratio of 1.47 and a beta of 1.58.

Caterpillar (NYSE:CAT - Get Free Report) last issued its earnings results on Tuesday, August 4th. The industrial products company reported $8.17 earnings per share (EPS) for the quarter, beating the consensus estimate of $6.22 by $1.95. Caterpillar had a net margin of 14.51% and a return on equity of 55.53%. The company had revenue of $20.54 billion for the quarter, compared to analyst estimates of $19.34 billion. During the same quarter last year, the firm earned $4.72 EPS. The company's revenue for the quarter was up 23.7% on a year-over-year basis. Sell-side analysts predict that Caterpillar will post 27.42 earnings per share for the current fiscal year.

Insider Buying and Selling at Caterpillar

In related news, CEO Joseph E. Creed sold 32,401 shares of the stock in a transaction dated Friday, August 28th. The stock was sold at an average price of $808.98, for a total transaction of $26,211,760.98. Following the completion of the transaction, the chief executive officer directly owned 34,555 shares in the company, valued at approximately $27,954,303.90. This trade represents a 48.39% decrease in their ownership of the stock. The transaction was disclosed in a filing with the Securities & Exchange Commission, which can be accessed through this hyperlink. 0.33% of the stock is owned by corporate insiders.

Hedge Funds Weigh In On Caterpillar

Hedge funds have recently made changes to their positions in the business. Nautilus Advisors LLC boosted its holdings in Caterpillar by 3.1% during the third quarter. Nautilus Advisors LLC now owns 957 shares of the industrial products company's stock worth $776,000 after purchasing an additional 29 shares during the last quarter. Byrne Asset Management LLC increased its stake in Caterpillar by 19.8% in the 3rd quarter. Byrne Asset Management LLC now owns 4,121 shares of the industrial products company's stock valued at $3,087,000 after buying an additional 681 shares during the last quarter. Legacy Private Trust Co. grew its holdings in shares of Caterpillar by 1.8% in the 3rd quarter. Legacy Private Trust Co. now owns 2,851 shares of the industrial products company's stock valued at $2,312,000 after acquiring an additional 51 shares in the last quarter. Olistico Wealth LLC raised its holdings in Caterpillar by 1.0% during the third quarter. Olistico Wealth LLC now owns 1,962 shares of the industrial products company's stock worth $1,591,000 after acquiring an additional 20 shares in the last quarter. Finally, Park National Corp OH grew its stake in Caterpillar by 5.1% in the third quarter. Park National Corp OH now owns 40,449 shares of the industrial products company's stock valued at $32,796,000 after purchasing an additional 1,962 shares in the last quarter. 70.98% of the stock is owned by institutional investors.

Key Caterpillar News

Here are the key news stories impacting Caterpillar this week:

• Positive Sentiment: Zacks Research raised EPS estimates across multiple periods, including Q3 2026 to $6.78 from $6.57, FY2026 to $27.36 from $27.01, FY2027 to $32.44 from $31.43, and Q3 2028 to $10.16 from $9.48. The firm maintains a “Strong-Buy” rating, signaling improving expectations for Caterpillar’s earnings trajectory.
• Positive Sentiment: Several market commentaries identify data-center power and infrastructure demand as a growth catalyst for Caterpillar. AI-related construction and electricity requirements could increase demand for the company’s power-generation equipment and support a potential rebound after its recent underperformance. Buy Q3 AI Data Center Laggards CAT, GLW, JBL for a Rebound in Q4
• Positive Sentiment: Jim Cramer described Caterpillar’s pullback as a possible buying opportunity and highlighted the company’s expanding role in supplying power for data centers. His comments may improve retail-investor sentiment, although they are opinion-based rather than a fundamental forecast. Jim Cramer Sees a Possible Buying Opportunity in Caterpillar
• Positive Sentiment: A Seeking Alpha contributor upgraded Caterpillar to “Buy” ahead of earnings, adding another constructive analyst view before the next major catalyst. Caterpillar: Upgrading To Buy Ahead Of Earnings
• Negative Sentiment: Other analysis cautions that the data-center opportunity may already be priced into Caterpillar shares. With the stock trading at a premium valuation, execution risks or weaker-than-expected guidance could limit further gains. Caterpillar: Data Center Tailwinds Are Real, But The Valuation Is Too Steep For Me

About Caterpillar

Caterpillar Inc is a global manufacturer of construction and mining equipment, diesel and natural gas engines, industrial gas turbines, and diesel-electric locomotives. Its products are used in infrastructure development, construction, mining, energy production, transportation, agriculture, forestry, and other industrial applications.

The company markets equipment and related services through a worldwide network of independent dealers. Its operations are generally organized around Construction Industries, Resource Industries, and Energy & Transportation.

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