Caterpillar's Record Backlog 🚜

Early Bird Prime for June 29, 2025

In the world of heavy machinery, shares of Caterpillar $CAT ( ▲ 0.74% ) have been quietly purring along in 2025, outperforming the overall market with a respectable 6.93% gain.

Analyst upgrades and solid core operations have helped the stock in recent months.

This past week, Truist Securities reiterated a "Buy" rating for Caterpillar, raising their price target from $396 to $414. They believe the company is poised to benefit from secular tailwinds tied to growing demand for energy and power, not to mention a record backlog that means strong future sales visibility, demand resilience, and a buffer against uncertainty.

However, just when you thought it was safe to invest, along comes the new Trump Tariffs. Although some tariff relief has been granted, most goods imported from China still face a hefty tariff. Caterpillar has guided for a $250–$350 million hit in Q2 2025 due to these tariffs, which could further pressure margins if their mitigation strategies fall short. Ongoing trade negotiations add to the uncertainty.

As a result, the near-term outlook for Caterpillar remains murky. The risks from tariffs, weak demand, and pricing pressure loom large, casting a shadow over the company's otherwise sunny disposition. 

Should you invest in Caterpillar’s stock in 2025, or should you avoid the stock? Here’s the answer:

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