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Bank of America/Merrill Lynch Upgrades Caterpillar to “Buy”; Fundamentals, Valuation Attractive (CAT)

By Dividend.com,  April 16, 2012, 09:17:02 AM EDT

Construction and mining equipment maker Caterpillar Inc. ( CAT ) on Monday caught a big upgrade from analysts at Bank of America/Merrill Lynch.

The firm said it raised its rating on CAT from "Neutral" to "Buy" and lifted its price target to $135. That new target implies a healthy 27% upside to the stock's Friday closing price of $105.89.

Bank of America/Merrill Lynch cited CAT's solid fundamentals and attractive valuation for the big upgrade.

Caterpillar shares rose $2.33, or +2.2%, in premarket trading Monday.

The Bottom Line
Shares of Caterpillar ( CAT ) have a 1.74% dividend yield, based on Friday's closing stock price of $105.89. The stock has technical support in the $100-$101 price area. If the shares can firm up, we see overhead resistance around the $110-$111 price levels.

Caterpillar Inc. ( CAT ) is not recommended at this time, holding a Dividend.com DARS™ Rating of 3.4 out of 5 stars.

Be sure to visit our complete recommended list of the Best Dividend Stocks , as well as a detailed explanation of our ratings system here .




The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.


This article appears in: Investing, Stocks

Referenced Stocks: CAT



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