alacatr/iStock Unreleased via Getty Images Introduction Caterpillar ( CAT ) needs little introduction. The century-old yellow machinery company powered much of the world's construction and mining and continues to dominate these markets today. But in recent years, as seen in Wall Street narratives and Caterpillar’s own financials, it is evident that Caterpillar is transforming more into a power and...
alacatr/iStock Unreleased via Getty Images Introduction Caterpillar ( CAT ) needs little introduction. The century-old yellow machinery company powered much of the world's construction and mining and continues to dominate these markets today. But in recent years, as seen in Wall Street narratives and Caterpillar’s own financials, it is evident that Caterpillar is transforming more into a power and energy infrastructure player, with almost 50% of the company's revenues coming from that segment, and AI data centers sit in the centerpiece of that story. The data center-led growth narrative is real, but as shown ahead, the current valuation assumes unrealistic growth, and hence the stock, at current levels of $680, is a sell in my view. The Sell Thesis The data center growth is real, but I wanted to understand what growth rate the market is expecting from CAT at the current price levels of $680 per share. For that, I ran a reverse DCF analysis, which implies that for CAT to justify its current $316 billion valuation, it would need to deliver 10% sustained free cash flow growth. I then built a segment model using pretty optimistic scenarios: Power Generation growing at its observed two-year CAGR of 27%, along with generous assumptions for other segments of Oil & Gas; Construction; and Resource Industries. Even under such an optimistic setup, the model implies profit growth of only about 6%. The market, meanwhile, appears to be pricing in 10%+ sustained free cash flow growth. That gap between what the market expects and what the business can plausibly deliver is the central argument for a sell. The Recent Performance CAT reported revenues of $67.6 billion in 2025, slightly higher than the year prior, but EPS declined from $22 to $19 owing to a fall in profits driven by unfavorable price realizations and higher manufacturing costs from tariffs. The company also reported a strong backlog of $51 billion, up from $30 billion the year prior. Much of this backlog is driven by s...
For years, the Dow Jones Industrial Average (^DJI 0.96%), S&P 500 (^GSPC 1.51%), and Nasdaq Composite (^IXIC 2.01%) have appeared unstoppable. The evolution of artificial intelligence (AI), record corporate share buybacks, and the prospect of lower interest rates have fueled this bull market rally. But the foundation for one of Wall Street's key pillars is crumbling, and neither Wall Street nor ev...
For years, the Dow Jones Industrial Average (^DJI 0.96%), S&P 500 (^GSPC 1.51%), and Nasdaq Composite (^IXIC 2.01%) have appeared unstoppable. The evolution of artificial intelligence (AI), record corporate share buybacks, and the prospect of lower interest rates have fueled this bull market rally. But the foundation for one of Wall Street's key pillars is crumbling, and neither Wall Street nor everyday investors are ready for it. Say goodbye to the Federal Reserve's rate-easing cycle? With the stock market entering 2026 at its second-priciest valuation since 1871, according to the S&P 500's Shiller Price-to-Earnings (P/E) Ratio, investors have been counting on additional interest rate cuts by the Federal Reserve to fuel growth. Reducing lending rates can encourage businesses to borrow, ultimately leading to increases in hiring, innovation, and acquisitions. Lowering interest rates is similar to pressing the accelerator in a car to make it go faster. But the Iran war has thrown a monkey wrench into the central bank's plans. Since the U.S. and Israel launched military attacks against Iran on Feb. 28, oil prices have soared. This is in direct response to Iran's virtual closure of the Strait of Hormuz, through which approximately 20% of the world's liquid petroleum travels daily. This oil price shock is expected to resonate throughout the U.S. economy and notably raise the inflation rate in the months to come. According to estimates from the Federal Reserve Bank of Atlanta, courtesy of Carson Group's Chief Market Strategist, Ryan Detrick, there's now a higher probability of the Fed hiking rates over the next three months than there is of the central bank cutting rates. Just as lowering borrowing costs is designed to accelerate economic growth, raising interest rates often cools lending demand and tempers growth expectations. It wouldn't be particularly good news for the AI-driven technology sector. If the Fed's script flips, Wall Street's bull market rally may be over ...
Key Points The evolution of artificial intelligence (AI), record share buybacks, and an ongoing Fed rate-easing cycle have powered the Dow Jones Industrial Average, S&P 500, and Nasdaq Composite higher. However, the inflationary impact of the Iran war has thrown a huge monkey wrench into the central bank's rate-easing cycle -- and that's bad news for Wall Street. Halting or reversing interest rate...
Key Points The evolution of artificial intelligence (AI), record share buybacks, and an ongoing Fed rate-easing cycle have powered the Dow Jones Industrial Average, S&P 500, and Nasdaq Composite higher. However, the inflationary impact of the Iran war has thrown a huge monkey wrench into the central bank's rate-easing cycle -- and that's bad news for Wall Street. Halting or reversing interest rate cuts is a potential worst-case scenario for a historically expensive stock market. 10 stocks we like better than S&P 500 Index › For years, the Dow Jones Industrial Average (DJINDICES: ^DJI), S&P 500 (SNPINDEX: ^GSPC), and Nasdaq Composite (NASDAQINDEX: ^IXIC) have appeared unstoppable. The evolution of artificial intelligence (AI), record corporate share buybacks, and the prospect of lower interest rates have fueled this bull market rally. But the foundation for one of Wall Street's key pillars is crumbling, and neither Wall Street nor everyday investors are ready for it. Will AI create the world's first trillionaire? Our team just released a report on the one little-known company, called an "Indispensable Monopoly" providing the critical technology Nvidia and Intel both need. Continue » Say goodbye to the Federal Reserve's rate-easing cycle? With the stock market entering 2026 at its second-priciest valuation since 1871, according to the S&P 500's Shiller Price-to-Earnings (P/E) Ratio, investors have been counting on additional interest rate cuts by the Federal Reserve to fuel growth. Reducing lending rates can encourage businesses to borrow, ultimately leading to increases in hiring, innovation, and acquisitions. Lowering interest rates is similar to pressing the accelerator in a car to make it go faster. But the Iran war has thrown a monkey wrench into the central bank's plans. Since the U.S. and Israel launched military attacks against Iran on Feb. 28, oil prices have soared. This is in direct response to Iran's virtual closure of the Strait of Hormuz, through which a...
primeimages/iStock via Getty Images Investor sentiment was majorly weighed down last week by escalating tensions over the U.S.-Iran conflict, which drove crude oil prices sharply higher and rekindled fears of a stagflationary environment. Consumer discretionary, financials, and industrials bore the brunt of selling pressure, reflecting concerns over slowing growth and tighter financial conditions....
primeimages/iStock via Getty Images Investor sentiment was majorly weighed down last week by escalating tensions over the U.S.-Iran conflict, which drove crude oil prices sharply higher and rekindled fears of a stagflationary environment. Consumer discretionary, financials, and industrials bore the brunt of selling pressure, reflecting concerns over slowing growth and tighter financial conditions. Meanwhile, energy emerged as a relative outperformer, mainly due to the oil price surge, while defensive positioning gained traction across healthcare and select industrial plays. Amid broader market noise, let us look at individual stocks that have momentum indicators pointing to an oversold territory. Here is a list of Nasdaq constituent companies that have low Relative Strength Index levels. Cintas Corporation ( CTAS ), RSI - 27; 1-week: -7.7% Coca-Cola Europacific Partners ( CCEP ), RSI - 27; 1-week: -8.8% PACCAR ( PCAR ), RSI - 28; 1-week: -3.5% Copart ( CPRT ), RSI - 28; 1-week: -3.6% NXP Semiconductors N.V. ( NXPI ), RSI - 29; 1-week: +0.27% The Kraft Heinz Company ( KHC ), RSI - 29; 1-week: -4.5% Ferrovial SE ( FER ), RSI - 29; 1-week: -2.5% O'Reilly Automotive ( ORLY ), RSI - 30; 1-week: -4.6% GE HealthCare Technologies ( GEHC ), RSI - 30; 1-week: -1.6% PepsiCo ( PEP ), RSI - 30; 1-week: -6.2% Monster Beverage ( MNST ), RSI - 31; 1-week: -4.4% Traders often use RSI to spot trend reversals, entry/exit points, and overextended price moves. RSI above 70 indicates the stock may be overbought, while RSI below 30 indicates that the stock may be oversold. More on companies Kraft Heinz: A Turnaround Story Coming With A ~14% Free Cash Flow Yield Kraft Heinz: Challenges Are Real, But Too Cheap To Give Up On Ketchup Or Catch-Down? Kraft Heinz Is Racing Against Structural Decline PepsiCo tackles geopolitical risks with local sourcing and hedging UBS highlights top industrial stocks with strong upside
European stocks slumped, with the Stoxx Europe 600 Index on course for a correction from its February record high, as the conflict in the Middle East escalated. The Stoxx Europe 600 was down 1.5% by 8:21 a.m. in London, leaving it more than 11% below its February peak and in technical correction. Sectors retreated across the board, with industrials and mining shares among the biggest laggards. The...
European stocks slumped, with the Stoxx Europe 600 Index on course for a correction from its February record high, as the conflict in the Middle East escalated. The Stoxx Europe 600 was down 1.5% by 8:21 a.m. in London, leaving it more than 11% below its February peak and in technical correction. Sectors retreated across the board, with industrials and mining shares among the biggest laggards. The region’s shares fell after Iran carried out fresh strikes across the Persian Gulf hours before US President Donald Trump’s deadline to reopen the Strait of Hormuz expires. “Trump’s ultimatum is aggravating the situation and is clearly being reflected in equity markets,” said Aneeka Gupta , director of macro-economic research at Wisdomtree. “There’s been a move from uncertainty to certainty that this looks like a more protracted conflict.” In individual stocks, Telecom Italia SpA rose 5.5% after Poste Italiane SpA launched a €10.8 billion ($12.5 billion) public offer to delist the firm. For more on equity markets: Strategists Unfazed by War Expect Stocks to Bounce: Taking Stock M&A Watch Europe: Telecom Italia, Delivery Hero, FiberCop, KKR US Stock Futures Fall You want more news on this market? Click here for a curated First Word channel of actionable news from Bloomberg and select sources. It can be customized to your preferences by clicking into Actions on the toolbar or hitting the HELP key for assistance. To subscribe to a daily list of European analyst rating changes, click here .
XPENG INC.(9868.HK):NON-AUTO BUSINESS AND SUBSIDIES BOLSTERED FIRST QUARTERLY PROFIT;VALUATION DRIVERS TO SHIFT TOWARDS PHYSICAL AI SEGMENTAL METRICS - 富途牛牛 富途牛牛
XPENG INC.(9868.HK):NON-AUTO BUSINESS AND SUBSIDIES BOLSTERED FIRST QUARTERLY PROFIT;VALUATION DRIVERS TO SHIFT TOWARDS PHYSICAL AI SEGMENTAL METRICS - 富途牛牛 富途牛牛
XPENG INC.(9868.HK):NON-AUTO BUSINESS AND SUBSIDIES BOLSTERED FIRST QUARTERLY PROFIT;VALUATION DRIVERS TO SHIFT TOWARDS PHYSICAL AI SEGMENTAL METRICS - 富途牛牛 news.futunn.com
XPENG INC.(9868.HK):NON-AUTO BUSINESS AND SUBSIDIES BOLSTERED FIRST QUARTERLY PROFIT;VALUATION DRIVERS TO SHIFT TOWARDS PHYSICAL AI SEGMENTAL METRICS - 富途牛牛 news.futunn.com
Zhang Daoming. Zhang Daoming is set to be appointed president of PICC Property and Casualty Co. Ltd., formally filling a role that has been vacant for nearly four months, sources familiar with the matter told Caixin. Zhang, 50, has been serving as interim head since December, after former President Yu Ze came under a graft probe. Zhang brings roughly three decades of industry experience and curren...
Zhang Daoming. Zhang Daoming is set to be appointed president of PICC Property and Casualty Co. Ltd., formally filling a role that has been vacant for nearly four months, sources familiar with the matter told Caixin. Zhang, 50, has been serving as interim head since December, after former President Yu Ze came under a graft probe. Zhang brings roughly three decades of industry experience and currently serves as vice president and chief financial officer at state-owned PICC.