Caterpillar Tumbles 1.92% on $1.4B Volume Ranked 51st as Downgrade and Missed Earnings Fuel Sell-Off

Caterpillar (CAT) declined 1.92% on August 11, 2025, with a trading volume of $1.4 billion, ranking 51st on the day. The stock faced pressure following a downgrade from Morgan Stanley, which cut its rating to "Underweight" from "Equal-weight," citing concerns over valuation and weakening fundamentals. Analysts highlighted deteriorating pricing trends and margin pressures, with a revised price target of $350. Meanwhile, Caterpillar's Q2 earnings report, which missed estimates, contributed to the sell-off despite a recent 50% rally since April.

Recent analyst commentary remained mixed. While some institutions raised price targets, such as Truist Financial’s $507 and Bank of America’s $495, others expressed caution. The company’s involvement in a Utah data center project with Joule Capital Partners and Wheeler Machinery Co. signaled long-term strategic moves, though short-term risks persisted. Institutional holdings data showed reduced stakes from First American Trust FSB, while hedge funds like GAMMA Investing significantly increased positions in Q1.

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