Caterpillar (NYSE: CAT) FY Conference Summary Company Overview - **Company**: Caterpillar Inc. (NYSE: CAT) - **Event**: Fireside Chat at the Barclays Industrial Select Conference - **Date**: February 18, 2026 Key Points Financial Performance and Strategy - Caterpillar's strategy focuses on growing absolute Operating Profit After Capital Charge (OPACC) dollars, which correlates highly with free cash flow and total shareholder return [5][6] - Since 2020, Caterpillar has generated a top quartile total shareholder return and increased OPACC dollars by 4.1 times [5] - New Investor Day targets set to grow sales and revenues by 5% to 7% annually until 2030, with a 4% growth achieved last year [6] - Operating margin target range has been adjusted from 10%-22% to 15%-25% [9] - Free cash flow generation has exceeded $9 billion over the last three years, marking Caterpillar as a strong cash generator within the S&P 500 industrials [12][13] Investment and Growth - Caterpillar plans to increase capital expenditures (CapEx) to around $3.5 billion this year, doubling CapEx over the next five years compared to the previous five [11] - Investment in digital and technology, including automation and connectivity, will increase by 2.5 times by 2030 [12] - Services revenue grew modestly to over $24 billion last year, with a target of $30 billion by 2030 [7] Market Segments and Opportunities - Caterpillar operates in three main segments: Construction Industries, Resource Industries, and Power and Energy [17] - The construction industry saw a 5% growth in sales despite a down market, driven by merchandising programs [6][19] - The demand for energy, particularly gas, is expected to grow, benefiting Caterpillar's Power and Energy segment [17] - Infrastructure spending remains strong, particularly in North America, with ongoing investments from the Infrastructure Investment and Jobs Act (IIJA) [19] Backlog and Orders - Caterpillar reported over $10 billion in backlog growth this quarter, with significant orders in the Power and Energy sector [29] - The AIP project represents about 1 GW of power, slightly smaller than previous large orders, reflecting strong demand for alternative energy solutions [30] Inventory Management - Caterpillar maintains dealer inventories within a normal range of three to four months, focusing on avoiding excess inventory to prevent production issues [41][43] Tariffs and Mitigation Strategies - Caterpillar is a net exporter from the U.S. and is closely monitoring tariff impacts, particularly related to steel and aluminum [45][46] - The company is exploring sourcing changes and maximizing exemptions to mitigate tariff impacts [49] Shareholder Returns - Caterpillar has returned approximately 84% of free cash flow to shareholders through dividends and buybacks, with a 7% dividend growth last year [7][14] - The company has a history of increasing dividends for 32 consecutive years, positioning itself as a dividend aristocrat [13] Conclusion - Caterpillar is focused on driving strong total shareholder returns while investing in profitable growth and maintaining a diverse portfolio to reduce volatility [15][54]

Core Insights - Caterpillar has completed the acquisition of RPMGlobal Holdings, an Australian mining software company, to enhance its data-driven technologies and software solutions for the mining sector [1][2] - The financial details of the acquisition remain undisclosed, but it is seen as a strategic move to address challenges faced by mining customers [1][2] - RPMGlobal will maintain its brand identity and continue to operate under its established name, indicating a commitment to its existing customer base [3] Group 1 - The acquisition is expected to unlock new opportunities for improving mine site performance by integrating RPMGlobal's software capabilities with Caterpillar's equipment and technology solutions [2][4] - RPMGlobal specializes in software solutions throughout the mining value chain, which complements Caterpillar's existing offerings [2][3] - Caterpillar's Resource Industries group president emphasized that this acquisition is a milestone in solving daily challenges faced by mining customers [2] Group 2 - RPMGlobal's CEO expressed confidence that Caterpillar is an ideal partner for their technology offerings, highlighting the complementary nature of both companies [3][4] - The acquisition aligns with Caterpillar's broader strategy, which includes a recent five-year global framework agreement with Vale to focus on productivity, innovation, and carbon reduction initiatives [5]

Core Viewpoint - Caterpillar Inc. has acquired RPMGlobal Holdings Limited to enhance its mining technology solutions, aiming to improve efficiency and performance for mining customers [1]. Group 1: Acquisition Details - Caterpillar announced the acquisition of RPMGlobal in October 2025, with the deal aimed at expanding its portfolio of data-driven mining technology and software solutions [1]. - RPMGlobal, based in Brisbane, Australia, specializes in providing data-driven software solutions across the mining value chain, bringing nearly 50 years of expertise to the table [1]. Group 2: Strategic Implications - The acquisition is seen as a significant milestone in Caterpillar's strategy to address the challenges faced by mining customers, combining RPMGlobal's software capabilities with Caterpillar's equipment and technology [1]. - Both companies believe that the integration of their technology offerings will enable them to tackle the most pressing challenges in the mining industry more effectively [1]. Group 3: Company Backgrounds - Caterpillar reported sales and revenues of $67.6 billion in 2025, positioning itself as a leading manufacturer in construction and mining equipment, as well as other industrial solutions [1]. - RPMGlobal has been a leader in mining software solutions for almost 50 years, supporting clients in over 125 countries to enhance operational efficiency and safety [1].

Core Viewpoint - Trump's America First agenda is significantly boosting industrial ETFs like the Industrial Select Sector SPDR Fund (XLI), which has returned 28% over the past year compared to 12% for the S&P 500 [1] Group 1: Fund Performance - The Industrial Select Sector SPDR Fund (XLI) has a pure industrial focus with 81 holdings and an annual fee of 0.08% [1] - XLI's top holdings include GE Aerospace and RTX, with the top ten holdings representing 40% of the fund's assets [1] - The fund has generated significant alpha, with five-year gains of 108% and year-to-date 2026 returns of 12.3% [1] Group 2: Economic Context - The industrial sector benefits from GDP growth acceleration, infrastructure spending commitments, and defense budget increases, with current GDP growth at 4.4% [1] - Aerospace and defense companies are positioned to benefit from military modernization spending and the recovery of commercial aviation as travel demand normalizes [1] - Traditional cyclicals like Caterpillar are expected to gain from new construction projects and mining operations [1] Group 3: Risks and Constraints - The fund's performance is highly cyclical, and demand for industrial companies can evaporate quickly during economic slowdowns, as indicated by a 0.64% year-over-year decline in manufacturing employment [1] - XLI carries concentration risk, as a downturn in major holdings like Boeing or Caterpillar could significantly impact the entire portfolio [1]

国家知识产权局信息显示，卡特彼勒公司取得一项名为"机器系统中的预测扭力减振器损坏确定"的专 利，授权公告号CN112780712B，申请日期为2020年10月。 声明：市场有风险，投资需谨慎。本文为AI基于第三方数据生成，仅供参考，不构成个人投资建议。 本文源自：市场资讯 作者：情报员 ...

Core Viewpoint - Caterpillar Inc. (NYSE:CAT) has shown significant stock performance, with shares increasing by 115% over the past year and 27% year-to-date, indicating strong market confidence in the company [1]. Financial Performance - In the fiscal fourth quarter, Caterpillar reported revenues of $19.1 billion and earnings of $5.16 per share, reflecting robust financial health [1]. - Analysts from Baird and Jefferies have raised their price targets for Caterpillar's stock, with Baird increasing it to $805 from $680 and Jefferies to $750 from $700, both maintaining a positive outlook on the stock [1]. Market Trends - The CEO of Caterpillar, Joe Creed, highlighted a shift among data center operators towards on-site power generation, which aligns with Jim Cramer's view that the company will benefit from the growing data center construction boom [1]. - Cramer has expressed strong enthusiasm for Caterpillar, suggesting that its performance is exceptional and worth attention [2].

Economic Overview - The jobs data for January showed an addition of 130,000 jobs, with the unemployment rate decreasing to 4.3%, both better than expected. However, previous months' job gains were revised down significantly, with 2025's total job additions revised from 584,000 to 181,000, indicating a weaker job market than previously thought [3][4][5]. - Inflation data revealed a Consumer Price Index (CPI) of 2.4% for the headline number and 2.5% for core CPI, which remains above the Federal Reserve's 2% target, suggesting ongoing inflationary pressures despite a cooler-than-expected report [7][8]. Company Earnings and Stock Performance - Caterpillar (CAT) reported modest earnings growth, with a 3% increase, but has seen a significant rise of 21% since the earnings announcement, driven by capital expenditures from major tech companies [10][12]. - Alphabet is selling debt, including a 100-year bond, to finance its AI expansions, indicating a long-term commitment to AI despite current profitability concerns [13]. - Cisco (CSCO) experienced a 12% drop in stock price post-earnings, despite exceeding earnings guidance, due to margin and cost concerns, although it remains up 19% year-over-year [14]. - Applied Materials (AMAT) saw a 10% increase in stock price following strong earnings and guidance, benefiting from increased spending in the AI sector [15]. Market Trends and Future Outlook - The economic landscape is characterized by uncertainty, with AI investments becoming a significant part of capital expenditures, raising questions about the overall economic stability [9]. - Walmart (WMT) is positioned well in the current market, recently reaching a market cap of over $1 trillion, and is expected to provide insights into consumer spending and technological integration in its upcoming earnings report [28][30].

Construction Industries - The Construction Industries segment focuses on machinery for infrastructure and building construction, with significant sales in heavy and general construction, rental, quarry, and mining industries [14]. - In 2025, the majority of research and development spending in the Construction Industries segment was directed towards the next generation of construction machines, emphasizing customer-driven product innovations [15]. Resource Industries - The Resource Industries segment provides machinery for mining and heavy construction, with a broad product range aimed at high productivity and low total cost of ownership [20]. - The competitive landscape for Resource Industries includes global competitors such as Deere Construction & Forestry and Komatsu, as well as numerous regional players [22]. Power & Energy - The Power & Energy segment supports various applications, including oil and gas and power generation, with a focus on compliance with regulatory emissions standards [25][26]. - The order backlog was approximately $51.2 billion at December 31, 2025, up from $30.0 billion at December 31, 2024, with a significant increase in the Power & Energy segment [50]. Cat Financial - Cat Financial, the financial products segment, provides retail and wholesale financing for Caterpillar products, with a significant portion of its activity in North America [29][38]. - Cat Financial offers various financing products, including loans and leases, to support sales of Caterpillar products and services [31][32]. - The competitive environment for Cat Financial includes commercial banks and finance companies, as well as financial subsidiaries of competing manufacturers [35]. - Cat Financial employs a match-funding policy to manage interest rate risk, aligning the interest rate profile of its debt portfolio with its receivables portfolio [39]. Insurance Services - Caterpillar Insurance Company and Caterpillar Life Insurance Company provide property, casualty, and life insurance services, regulated by various authorities to ensure compliance with financial requirements [42][43]. - Caterpillar's insurance group provides various coverages, including $19.3 billion in international employee benefit plans reinsured through retrocession agreements [46]. Employment and Safety - As of December 31, 2025, the company employed about 118,000 full-time employees, an increase from 112,900 in 2024, with 66,400 located outside the United States [65]. - The recordable injury frequency rate improved to 0.41 in 2025 from 0.43 in 2024, reflecting the company's commitment to employee safety [58]. - The company achieved a total of 7,972 hourly production employees in the U.S. covered by collective bargaining agreements as of December 31, 2025 [65]. - Caterpillar's leadership development programs focus on building resilient teams and enhancing employee skills tailored to business needs [60]. Supply Chain and Compliance - The company maintains strategic sourcing models to ensure timely delivery of raw materials and components, despite facing supply chain disruptions [48]. - The company is committed to complying with environmental regulations, investing significantly in research and development to meet emissions standards [67]. - The total health programs emphasize physical, mental, and financial wellness, aligning with the company's pay-for-performance philosophy [64].

Core Insights - The Dow Jones Industrial Average (DJIA) recently surpassed the 50,000 mark for the first time, indicating a strong bull market led by AI, although it experienced a subsequent decline [1] - Investors are shifting from high-growth AI stocks, referred to as the "Magnificent Seven," to value stocks that generate cash flow, amid concerns over capital expenditures (CapEx) [1] - Caterpillar, a significant component of the Dow, has seen a 33% year-to-date gain, contributing to the index's outperformance [1] Market Dynamics - The current market environment suggests a rotation away from AI disruptors and software companies towards more stable, cash-generating assets [1] - The Dow's relative strength is notable, as it has outperformed the S&P 500 and Nasdaq 100, indicating a potential shift in investment strategy [1] - Concerns over CapEx and the performance of major tech companies have led to a cooling off period for high-growth stocks, prompting investors to consider diversifying their portfolios [1] Company-Specific Insights - Moody's shares have declined over 23% recently due to fears that agentic AI could undermine its competitive advantages, despite its strong data moat and regulatory barriers that may protect its market position [1] - The article suggests that the recent drop in Moody's stock presents an opportunity for investors looking to capitalize on the broader bull market and AI-driven productivity gains [1] - Goldman Sachs has highlighted the potential benefits for old-economy stocks from AI adoption, indicating a broader market trend towards undervalued companies that can leverage AI technologies [1]

Core Viewpoint - The increasing power consumption of AI data centers is creating a significant demand for gas turbines, which are becoming the preferred solution for addressing power supply gaps in the industry [1][2]. Group 1: Demand and Supply Dynamics - The gas turbine sector is experiencing a robust uptrend driven by four key factors: explosive demand, rigid supply constraints, technological barriers, and overseas market transmission [2]. - AI data centers' electricity consumption has surged from 50MW to as high as 1GW, with projections indicating that by 2030, AI data centers will account for 16% of total U.S. electricity consumption, necessitating an additional 104-130GW of power generation capacity [2]. - The aging U.S. power grid, with an average lifespan exceeding 35 years, is unable to meet the rising electricity demand, while alternative energy sources like nuclear and renewables face long construction timelines and stability issues [2]. Group 2: Gas Turbine Market Characteristics - Gas turbines are favored for their quick startup, short construction cycles, economic efficiency, and high reliability, making them the standard power supply solution for AI data centers [3]. - The global gas turbine market is dominated by three major players—Mitsubishi Heavy Industries, Siemens Energy, and GE Vernova—who collectively hold a 76.3% market share, with future global orders expected to reach 100GW per year against a current manufacturing capacity of approximately 60GW, indicating a significant supply-demand gap [3][7]. - Orders for popular gas turbine models are currently scheduled for delivery between 2028 and 2030, highlighting the extended lead times in the industry [3]. Group 3: Industry Growth and Opportunities - Major overseas players are experiencing a surge in orders, with GE Vernova reporting a 46% year-on-year increase in gas turbine orders, and Siemens Energy's gas service business seeing a 42% increase in new orders [7]. - The supply chain for gas turbines is complex, with critical components like high-temperature blades facing long production cycles of 3-5 years, creating bottlenecks in supply [8]. - Domestic companies are positioned to benefit from the overflow of orders as international firms shift production to China, leveraging a complete high-end manufacturing supply chain and technological advancements [8]. Group 4: Investment Focus Areas - Future investments should focus on three main areas: overseas demand transmission, technological barriers, and domestic substitution [9]. - Companies with strong overseas integration capabilities and local service advantages are prioritized for short-term performance, while core component suppliers are seen as long-term stable investments due to their critical role in the gas turbine value chain [9][10]. - Domestic pioneers in gas turbine technology are expected to gain traction as the industry moves towards greater localization, particularly in heavy-duty turbines and supporting materials [10]. Conclusion - The surge in AI computing demand is reshaping the global energy supply landscape, with gas turbines emerging as the optimal short-term power solution, leading to a period of significant growth in the industry [11]. - The ongoing verification of industry data and the increasing demand for gas turbines suggest a favorable outlook for the sector, with a focus on overseas demand, technological barriers, and domestic substitution as key investment themes [11].