Monica Almeida | Reuters
Traffic is diverted on Foothill Road as workers place K-rail barricades along burn areas during a winter rain storm in Ventura, California, January 9, 2018.
Caterpillar will be a big beneficiary of the recently passed corporate tax cut bill, according to one top Wall Street firm.
J.P. Morgan reiterated its overweight rating for Caterpillar shares, predicting strong sales growth for its construction equipment products in North America through 2022.
“We expect a continuation of a replacement cycle in NA [North American] construction end markets on the back of the tax incentives included in the Tax Cuts and Jobs Act (TCJA),” analyst Ann Duignan wrote in a note to clients Monday. “We are forecasting an extended upcycle through 2022 when demand could reach close to the 2005 peak. As the market leader in NA, CAT would likely be the outsized beneficiary of an extended cycle, in our view.”