Morgan Stanley says high dealer restocking raise Caterpillar peak cycle concerns

Morgan Stanley analyst Dillon Cumming raised the firm’s price target on Caterpillar to $191 from $190 and keeps an Underweight rating on the shares. While stating that an "operationally robust" Q1 margin outcome raises the bar for Caterpillar’s EPS ceiling in FY23, a combination of a "primarily" re-stocking driven Q1 top-line beat with a negative inflection in implied orders should "continue to drive peak cycle concerns exiting the print," the analyst tells investors.