Caterpillar stock: Evercore keeps Outperform view after target cut

Caterpillar stock remains under pressure after Evercore ISI lowered its price target to 833 US dollars from 1,045 US dollars on November 10, while retaining an Outperform rating. Yahoo Finance reported the change on November 11 and updated its analysis on November 13, linking the revised valuation to the stock's recent decline rather than to a major reduction in earnings expectations.

Caterpillar stock traded at 553.30 euros on Lang & Schwarz at 13:16 CET on Friday, November 13, 2026.

Record Quarter Meets A Cautious Outlook

Caterpillar reported its third quarter on October 29. Sales rose 17 percent to a record 20.7 billion US dollars, adjusted earnings per share increased to 7.20 US dollars from 4.95 US dollars a year earlier, and the backlog reached a record 78 billion US dollars, according to the Yahoo Finance analysis.

The stronger operating figures did not prevent investors from reassessing the near-term outlook. Management expects moderate fourth-quarter sales growth against a strong prior-year comparison and anticipates that dealers will reduce their inventories by about 1.6 billion US dollars. That inventory movement could weigh on deliveries even while customer demand and the long-term order book remain substantial.

Valuation Depends On Power Demand

Evercore analyst David Raso kept the positive rating but reduced the target after the sell-off. Yahoo Finance said the target implies roughly 40 percent upside to the share price used in the November 10 analysis. The report also noted that the stock's decline has largely compressed its valuation multiple, while earnings estimates have changed only modestly.

The investment case remains tied to Caterpillar's Power and Energy business, where data-center demand has supported large-engine and turbine orders. The same exposure creates a risk: delays in data-center projects, permitting constraints or weaker customer spending could slow the pace at which the backlog becomes revenue. Caterpillar's record order book therefore provides support, but it does not remove execution and timing risks.

For investors, the key distinction is between demand visibility and near-term conversion. New production capacity must come online, dealers must work through inventory, and Caterpillar must translate its backlog into shipments without a sharper margin setback. The October earnings release gave no immediate signal that the longer-term opportunity had disappeared, but it did make the next operating milestones more important.

The next major test is expected with Caterpillar's fourth-quarter report in late January. Management is expected to provide its first detailed view of 2027, including how end-user demand is holding up while dealers reduce inventories. That update should help investors judge whether the current valuation reflects a temporary reset or a more durable slowdown in the power and construction cycle.

Broader industrial sentiment can be followed through the S&P 500 market environment.

More developments can be found in More news and analyses on Caterpillar stock.

Yahoo Finance reported that Evercore's revised target reflects a lower valuation multiple after Caterpillar's recent decline, while the analyst retained an Outperform view.