UPDATE: Wells Fargo Downgrades Caterpillar (CAT) to Market Perform

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(Updated - September 12, 2019 7:42 AM EDT)

(updated to add analyst comment)

Wells Fargo analyst Andrew Casey downgraded Caterpillar (NYSE: CAT) from Outperform to Market Perform with a price target of $143.00 (from $150.00).

The analyst comments "Stock has witnessed a nice bounce on sector rotation with some improved trade optimism. The positive momentum may not be quite complete, but we expect further upside to be limited. Looking beyond that, we believe US construction equipment demand will likely start to decrease off of peak conditions while Resource Industries improves mid-single digits and E&T compresses modestly. Without an acceleration in other large market exposures, we expect US construction equipment end market compression to (1) challenge CAT’s attempt to reduce global distributor inventory by $900 million in H2 19, (2) drive additional backlog declines and (3) support a negative earnings estimate revision cycle. All of these could be a headwind to stock upside potential from current levels."

For an analyst ratings summary and ratings history on Caterpillar click here. For more ratings news on Caterpillar click here.

Shares of Caterpillar closed at $133.09 yesterday.

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