Caterpillar price target raised to $434 from $376 at BofA

BofA raised the firm’s price target on Caterpillar to $434 from $376 and keeps a Buy rating on the shares. After having attended the MINExpo event last week, the analyst sensed “positive (albeit, measured), vibes” across meetings with OEMs, dealers and industry experts. For Caterpillar, the Resource Industries, or RI, segment is likely range bound in the near-term, yet long-term earnings are skewed to the upside, which “underpins the next, higher EPS cycle,” the analyst tells investors following the industry event. The firm, which maintains its “Miners over Farmers” view post MINExpo, notes that in Large Cap Machinery it continues to prefer Caterpillar as it believes a higher multiple is warranted given policy measures – including Fed easing and China stimulus – that suggest EPS stabilizes at “these high levels.”