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Luke Kawa

Caterpillar spikes as AI boom fuels demand for engines and turbines

Caterpillar is soaring in early trading after reporting Q1 results that crushed estimates.

The industrial bellwether reported revenues of $17.42 billion (compared to analyst estimates for $16.24 billion) with adjusted earnings per share of $5.54 (estimate: $4.63).

Behind every chatbot trying to figure out how many R’s are in strawberry is a data center in need of energy, and Caterpillar’s power generation business has been on a tear thanks to this demand.

“A record backlog provides a strong foundation for continued positive momentum,” Chairman and CEO Joe Creed said in the press release.

The industrial giant, like GE Vernova, is among the so-called “heavy assets, low obsolescence” companies that have been cashing in on the AI boom, rather than being disrupted by it.

The firm’s earnings report noted that in its power generation business, “sales increased in large reciprocating engines and in turbines and turbine-related services, primarily data center applications.”

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SpaceX gets a wave of bullish ratings from Wall Street analysts

SpaceX received more than a dozen positive analyst calls on Tuesday — including from major Wall Street banks — as they initiate coverage on Elon Musk’s space and AI company.

SpaceX went public on June 12 at a $2.2 trillion valuation, the largest debut in history. While the company hasn’t yet posted a profit, it seems to have convinced Wall Street that it will get there and grow its valuation on the way.

Of the at least 17 analysts that gave a rating on Tuesday, all but one gave it a “buy” or “outperform” rating. MoffettNathanson was "neutral."

The ratings come as SpaceX joined the Nasdaq 100 index, a benchmark tech-heavy basket of companies that underpins millions of portfolios. The inclusion adds built-in demand for the stock from index funds and ETFs.

Still, SpaceX fell more than 5% on Tuesday amid a broader sell-off, and is currently effectively flat from its opening price of $150 a share.

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Meta surges on report it’s starting a cloud business to sell excess AI compute

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