Shares of Caterpillar Inc. CAT, +0.84% rallied 1.1% in morning trading Friday to buck the selloff in the broader stock market, and enough to pace the Dow Jones Industrial Average’s DJIA, -1.13% gainers. Analyst Michael Feniger at BofA Securities reiterated the neutral rating on the construction and mining equipment company (CAT) but raised the stock price target to $224 from $215. Feniger said a call with Caterpillar Group President of Resource Industries Denise Johnson was “encouraging,” as there were “no signs of a slowdown from customers,” partnerships were unlocking new opportunities and technology investments were bearing fruit. The stock’s rally comes as the Dow slumped 305 points, or 0.9%, with 24 of 30 components losing ground. “CAT’s tech leadership is impressive,” Feniger wrote in a note to clients. “In our view, a more significant, sustained step up in pricing power could help illustrate that CAT is getting fully rewarded for its tech and underpin a re-rating story.” The stock has run up 14.2% the past three months, while the Dow has slipped 2.5%.
