The Zhitong Finance App learned that the investment bank Evercore ISI downgraded its stock rating of Caterpillar (CAT.US) to “outperform the market”, with a target price of $365. The bank believes that the decline in Caterpillar's profit and sales in the third quarter is a potential precursor to the downside risk of earnings in fiscal year 2025, as the company's management will eventually face rising inventory in the construction equipment channel.

Evercore ISI analysts led by David Raso said that after Trump is elected as the new president, weakness in emerging markets may put pressure on Caterpillar, and in the face of Trump's policies supporting oil and gas extraction with relatively low commodity prices, the oil and gas industry's capital expenditure response may not be as good as expected.

Furthermore, given that Caterpillar's stock price is close to 19 times Evercore ISI's earnings per share for fiscal year 2025, analysts believe it may be difficult for the stock to keep up with part of the industry in the short to medium term.

Meanwhile, Evercore ISI also downgraded the stock rating of Illinois Machinery (ITW.US) to “outperform the market”, with a target price of $255. Analysts believe that the company is an excellent operator and profit expansion machine, but the lack of organic sales growth, particularly in international markets, may cause its profit expansion in 2025 to be below average.

Evercore ISI also downgraded the stock rating of electricity management company ETN.US (ETN.US) from “outperforming the market” to “equal the market”, with a target price of $389.