Caterpillar Is Quietly Becoming an AI Stock. Here's the Segment Growing 72% That Proves It.
Sales of power equipment to data centers are driving the company's sales and backlog expansion.
Caterpillar, most known for its farm and construction equipment, is quietly transforming into an AI-focused stock. This transformation is highlighted by a 72% surge in retail sales of power generation equipment, a segment expanding at a remarkable rate. This surge is driven by the soaring demand for large generator sets and turbines, crucial for powering data centers.
With data centers consuming a significant portion of the U.S. electricity supply, expected to double by 2030, Caterpillar's power and energy segment is witnessing a boom. This growth is reflected in the company's record backlog of $72 billion, expanding by 92% in the past year. Caterpillar expects to report strong Q3 earnings, with Wall Street anticipating a 17% revenue increase and $7.03 per share earnings, up 42% from a year ago.
Investors looking for long-term growth, beyond core AI stocks like Nvidia and Alphabet, may find Caterpillar an attractive option.
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