Caterpillar (CAT) Stock Hits All-Time High After Blowout Earnings and Morgan Stanley Upgrade

TLDR

• CAT jumped nearly 10% to over $890, hitting a new all-time high after Q1 earnings
• EPS of $5.54 and sales of $17.4B beat Wall Street estimates of $4.65 EPS and $16.5B
• Power generation sales surged 48%, driven by data center demand
• CAT raised its annual sales growth forecast to 6%–9% through 2030, up from 5%–7%
• Baird raised its price target to a Street-high $1,165; Morgan Stanley upgraded from Sell to Hold

Caterpillar posted first-quarter earnings per share of $5.54 on sales of $17.4 billion. Wall Street had expected $4.65 EPS and $16.5 billion in revenue. The stock jumped almost 10% on Thursday to just over $890, a new all-time high.

Caterpillar Inc., CAT

Coming into Friday, CAT was up 55% year to date and up 184% over the past 12 months.

The company also raised its guidance. CAT now expects annual sales growth of 6% to 9% through 2030, up from its prior forecast of 5% to 7%. For 2026 specifically, it sees low double-digit sales growth, versus earlier guidance closer to 7%.

CEO Joe Creed pointed to strong execution and resilient end markets as the key drivers. Power generation sales grew 48%, fueled by demand for large gensets and turbines used in data centers.

CAT also reported a record backlog of $63 billion, up roughly 80% year over year.

Analyst Upgrades Roll In

Baird analyst Mig Dobre raised his price target to $1,165 from $940, the highest on Wall Street. He rates CAT Buy and tagged it a “Fresh Pick” after earnings, implying he expects the stock to move higher soon. That target suggests another 30% upside from current levels.

Dobre described the power generation opportunity as being in its “early innings,” with large orders recently announced set to be delivered over the next five years.

He also flagged that Q1 was the highest order intake quarter for CAT’s Resource Industries segment since 2012.

Morgan Stanley upgraded CAT to Equal-weight from Underweight. They raised their price target to $915 from $430, citing stronger-than-expected results, the record backlog, and improving long-term growth driven by power generation demand.

Morgan Stanley now forecasts a compound annual growth rate of 12% for CAT between 2025 and 2030.

Wall Street Playing Catch-Up

The average analyst price target sits around $860, still below where the stock is trading. That average has risen by about $80 since earnings were released.

Roughly half of analysts covering CAT rate it Buy. The typical Buy-rating ratio for S&P 500 stocks runs between 55% and 60%.

In early Friday trading, CAT was up 1.1% at just under $900. The S&P 500 was up 0.5% over the same period.

Morgan Stanley highlighted rising capital expenditure from hyperscalers and growing demand for natural gas engines in data centers as key factors supporting the upgraded outlook.

CAT’s record backlog of $63 billion provides visibility into future revenue that analysts say supports confidence in sustained growth.

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