Bank of America Merrill Lynch reported on Wednesday that they have increased their price target for construction and mining equipment manufacturer, Caterpillar Inc.(CAT).
The firm has reaffirmed a “Neutral” rating on CAT, and has raised its price target for the company from $92 to $100. This price target suggests a 5.7% increase from the stock’s current price of $94.24.
An analyst from the firm noted, “as the global leader, CAT is a global powerhouse in mining, construction, and power systems equipment. CAT is very well positioned for the long-term, but the slower earnings trajectory that we foresee in coming years due to fading momentum in mining equipment demand and a softer construction equipment outlook will likely limit the stock’s multiple expansion potential, in our view.”
Caterpillar shares were mostly flat during Wednesday afternoon trading. The stock has dropped 3% in the past year.
The Bottom Line
Shares of Caterpillar (CAT) have a 2.21% dividend yield, based on the latest intraday stock price of $94.29. The stock has technical support in the $87-$90 price area. If the shares can firm up, we see overhead resistance around the $97-$100 price levels.
Caterpillar Inc.(CAT) is not recommended at this time, holding a Dividend.com DARS™ Rating of 3.3 out of 5 stars.