Caterpillar: Risks Rise As Sentiment Makes A 180

Caterpillar stock has surged 36% since Q1 earnings, defying weak results due to a sharp reversal in sentiment and improving outlook. Dividend hike and resilient macro data boosted confidence, but current valuation already prices in known growth catalysts like infrastructure and energy transition. Earnings estimates are rising, but expectations are now high; Q2 results may disappoint or highlight ongoing challenges, risking a pullback.