Joe
Full-Time Trader/Investor, Semiconductor & AI Infrastructure Inflection Points
ProPetro can be rerated as a power producer in the next few months, with its Caterpillar power generation partnership a really big deal. It covers 2.1 GW over five years against a $2 billion market cap, more deals should come, and the stock should go a lot higher. The deal also helps its fracking equipment business. It may be a slower mover than small-cap tech and get dragged around by peace-talk headlines. x.com x.com x.comÂ
Caterpillar has a powerful tailwind from demand for power and energy, making it one of the best stocks to own right now. x.comÂ
Caterpillar is still undervalued, with about 25% upside tied to its visible backlog and AI and energy demand. Its autonomous mining technology is just getting started. x.com x.comÂ
Caterpillar looks asymmetric to the downside near $904 because higher-for-longer rates hurt all its lines: data centers, metals and mining capex, and energy. Oil won't let the Fed cut, and Iran seems to be stalling, so fade a deal. Up 3x this year, near its high at over 40x, it faces normalization or a capex cycle reversal. Dealer demand needs healthy financing as IPOs drain liquidity, and model routing could cut compute needs. If wrong, upside looks limited. x.com x.com x.com x.com x.com x.com … Show more
Caterpillar is the company actually building the data centers, and its Q2 2026 results show it. Revenue rose 24% to $20.54B against a $19.3B estimate, adjusted EPS rose 73% to $8.17 versus $6.20 expected, and operating profit grew 50% to $4.3B. Power & Energy grew 17%, Construction Industries 35% and Resource Industries 20%. It is a stellar company and a good long-term retirement holding. x.comÂ
Frac companies are delivering the biggest surprises relative to their stock prices among oil services, which favors ProFrac, Halliburton, ProPetro, Patterson-UTI and KLX Energy Services. x.comÂ
Caterpillar looks like a prime short because it trades on AI-style hype without earnings to match. Its quarter-on-quarter numbers aren't proving out: last quarter it earned less than last September, and revenue versus last year doesn't look great. The stock ran up hard even with rates at their peak and likely to stay there for a while. x.com x.com x.comÂ
Caterpillar is cheap here, with plenty of free cash flow to keep funding capex for the next few years, a historic $64 billion backlog and newly raised targets. It has the best chart among key industrials, and the sector is seeing strong inflows this week. Jefferies set a $1,045 target this morning, and JPMorgan sees $1,165. x.comÂ
Caterpillar has stretched too far on valuation relative to its main peers, especially Cummins. United Rentals, despite less direct exposure to data centers, is still catching up on multiples. x.comÂ
Caterpillar deserves a rerating because its earnings power now comes from data center power infrastructure, a secular driver, rather than the housing and mining cycles it has long been priced on. Power Systems grew 44% in Q4 as hyperscalers signed 2-gigawatt generator contracts for private grid capacity, the early stage of a multi-year procurement cycle no competitor can match on capacity or service network. Backlog hit $51 billion, up 71%. Rating is Overweight with an $860 December 2026 target. … Show more
Caterpillar is pivoting from heavy machinery into recurring software and autonomous technology on top of record fundamentals. Q1 2026 revenue rose 22% to $17.4 billion and adjusted EPS 30%, backlog is a record $63 billion, and construction revenue jumped 38%. The July Skycatch acquisition adds 3D drone mapping to its autonomous fleet, and it raised the dividend 8% after $5 billion of Q1 buybacks. Options gamma and moving-average support point to a breakout while those levels hold. x.comÂ
