Caterpillar's Secret Weapon: Data Centers Could Fuel A New Rally

Caterpillar Inc. (NYSE: CAT) is rated as a Buy by BofA Securities, with a price target of $825, indicating a potential upside of 17.5%. Analyst Michael Feniger highlights strong demand for power generation and the opportunity in data centers, particularly in Western Canada, which could significantly boost service revenues. Caterpillar is valued at 27.5 times projected 2027 earnings, driven by factors such as improving commodity prices and infrastructure spending, despite risks from tariffs and competition. As of the latest update, Caterpillar shares are trading at $706.18, up 0.54%.