HSBC Upgrades Caterpillar (CAT) to Buy, Lifts Price Target to $660 on Strong Power Demand

Core Insights - Caterpillar Inc. has been upgraded to a "Buy" rating by HSBC, with a new price target of $660, reflecting strong demand in power generation and a significant increase in order growth [2] - The company's Power Generation segment reported a revenue increase of 31% year-over-year, driven by sales of large reciprocating engines for data centers [3] - Overall, Caterpillar's quarterly sales rose 10% to $17.6 billion, indicating robust end-user demand and higher sales volumes [3] Financial Performance - Caterpillar generated $3.7 billion in operating cash flow for the quarter and ended with $7.5 billion in enterprise cash [4] - The company returned $0.7 billion to shareholders through dividends and spent an additional $0.4 billion on share repurchases [4] Market Position - Caterpillar is recognized as a global leader in manufacturing construction and mining equipment, industrial gas turbines, off-highway diesel and natural gas engines, and diesel-electric locomotives [4]