Caterpillar's Valuation: Power & Energy Segment Strength and Record Sales Amid AI Data Center Boom

Caterpillar's (CAT) quarterly results highlighted record sales and outperformance in its Power & Energy segment, tied to large AI data center projects and a record backlog for future activity. The share price has surged 21.74% in 1 month and 102.32% in 1 year, with the market associating strong momentum with its long-term power and infrastructure story. However, with the share price above the average analyst target and implied intrinsic value, the debate is whether CAT still offers an attractive entry point or if the market is already pricing in future growth.