THE APEX TIMES
Caterpillar’s power-and-energy boom tied to data centers lifts shares, draws ‘AI infrastructure’ spotlight alongside Vertiv and Eaton
A fresh Zacks Investment Ideas feature pointed to Caterpillar’s surge in data-center power demand, record order backlog, and aggressive cash returns, while noting that Vertiv and Eaton are also gaining from the buildout of electricity and thermal infrastructure for AI workloads.
Zacks Investment Ideas on Monday, June 8, 2026, highlighted Caterpillar as an unusual “AI infrastructure” beneficiary, arguing that accelerating data-center construction is translating into stronger demand for heavy power equipment. The same write-up also placed Vertiv and Eaton on the list, describing them as part of the wider chain of companies tied to the growth in data centers that must secure more electricity and manage heat from AI compute.
In Caterpillar’s first-quarter 2026 update, the company reported sales and revenues of $17.4 billion, up 22% year over year. Caterpillar also said its backlog reached a record $63 billion, up 79% year over year, a figure that Caterpillar’s earnings materials characterized as providing a “strong foundation” for continued momentum. The backlog and results arrive amid tight timelines and capacity constraints across segments of industrial manufacturing that feed data-center power buildouts.
Caterpillar’s Power & Energy segment was a key driver. Power & Energy sales were $7.031 billion in the quarter, up 22% year over year, and the company’s earnings release showed Power Generation application sales up 41% year over year. Zacks attributed the strength to rising demand for power products used in data centers, “primarily large reciprocating engines,” positioning Caterpillar as a supplier of the generation equipment that can be required when AI workloads need reliable backup or prime power.
Caterpillar is also indicating it will expand capacity to meet demand. In its first-quarter earnings presentation, the company described a strategy to increase “large reciprocating engine capacity” from 2 times 2024 levels to nearly 3 times, with updated long-range targets calling for power generation sales to exceed 3.0x the 2024 baseline by 2030. The company’s materials also framed the quarter as combining record backlog with continued investment to meet customer needs.
Alongside the growth narrative, Caterpillar emphasized shareholder returns. In the first quarter, Caterpillar deployed $5.0 billion for share repurchases and $0.7 billion for dividends, totaling $5.7 billion of cash returned to shareholders. It also maintained its quarterly dividend at $1.51 per share, with the April 8, 2026 announcement noting the payout payable May 19, 2026, and calling Caterpillar a member of the S&P 500 Dividend Aristocrats Index.
Zacks’ feature leaned heavily on the market reaction and valuation context. It said Caterpillar shares have been up more than 60% in 2026 and widely outperforming the S&P 500, while also noting that the stock’s forward 12-month earnings multiple had risen to 34.1x, compared with a 16.4x five-year median. Zacks cited its own consensus estimates implying about 30% EPS growth in fiscal 2026 and 24% in fiscal 2027, framing Caterpillar’s accelerating earnings as part of why the higher multiple had held.
For Vertiv and Eaton, Zacks described the same broader theme rather than detailing specific Caterpillar-like financial numbers in the excerpt that was visible publicly. The feature said both companies had strong runs in 2026 tied to their roles in data-center power and described “growth in their backlogs,” adding that analysts had raised sales expectations for Vertiv for its current and next fiscal years. The common thread is that data-center expansion needs not just servers and networking but also the electrical and thermal “infrastructure layer” that powers and cools the equipment that runs AI applications.
The uncertainty is where the theme meets disclosure limits. Caterpillar’s earnings materials and dividend release emphasize backlog, segment sales, and the capacity plan, but they do not provide a clean, audited breakdown of what portion of Power & Energy demand is attributable strictly to AI-led workloads versus other industrial and infrastructure drivers. And while Zacks connects Vertiv and Eaton to the buildout, the feature excerpt did not provide specific backlog totals or segment sales figures for those companies, limiting how precisely the market can triangulate “AI exposure” across the three names from this write-up alone. Investors watching next will likely focus on whether Caterpillar’s record backlog converts into continued revenue and cash flow as engine-capacity expansion ramps, and whether backlog growth in the power-and-cooling supply chain stays durable through 2026.
Why It Matters
- The story reinforces how AI data-center growth is flowing into industrial “infrastructure” supply chains, not just semiconductor and cloud spending.
- A record backlog and rising power-generation sales suggest multi-quarter revenue visibility for Caterpillar’s power-related business, assuming backlog converts as planned.
- Caterpillar’s cash returns, alongside continued investment capacity expansion, indicate the company is treating the demand wave as something it needs to fund rather than merely benefit from.
- Zacks’ inclusion of Vertiv and Eaton suggests investors are looking for sector spillover in companies that supply data-center power distribution and thermal management.
- The key watch item is durability, whether power buildouts sustain and whether capacity expansion keeps pace with order intake.
Sources
- (Yahoo Finance RSS link in prompt)
- Zacks Investment Ideas feature highlights: Caterpillar, Vertiv and Eaton (June 8, 2026)
- Caterpillar 1Q 2026 earnings release PDF (Ex 99.1)
- Caterpillar first-quarter 2026 earnings presentation (financial review slides)
- Caterpillar maintains dividend (April 8, 2026)
- Image
Key Facts
- Zacks Investment Ideas published its feature on June 8, 2026, highlighting Caterpillar along with Vertiv and Eaton in a data-center power demand theme.
- Caterpillar reported first-quarter 2026 sales and revenues of $17.4 billion, up 22% year over year.
- Caterpillar said its backlog reached a record $63 billion, up 79% year over year.
- In the quarter, Caterpillar’s Power & Energy segment posted $7.031 billion in sales, and its Power Generation application sales rose 41% year over year.
- Caterpillar deployed $5.0 billion for share repurchases and $0.7 billion for dividends in the first quarter.
- Caterpillar said it plans to increase large reciprocating engine capacity from 2x 2024 levels to nearly 3x, and expects power generation sales to exceed 3.0x 2024 levels by 2030.
- Zacks said Caterpillar shares are up more than 60% in 2026 and cited a 34.1x forward 12-month earnings multiple versus a 16.4x five-year median, alongside EPS growth estimates for fiscal 2026 and 2027.
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