A week ago, Caterpillar Inc. (NYSE:CAT) came out with a strong set of second-quarter numbers that could potentially lead to a re-rate of the stock. The company beat forecasts, with revenue of US$21b, some 7.0% above estimates, and statutory earnings per share (EPS) coming in at US$7.77, 27% ahead of expectations. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.

Taking into account the latest results, the consensus forecast from Caterpillar's 16 analysts is for revenues of US$78.9b in 2026. This reflects a reasonable 5.5% improvement in revenue compared to the last 12 months. Per-share earnings are expected to climb 13% to US$26.71. In the lead-up to this report, the analysts had been modelling revenues of US$76.7b and earnings per share (EPS) of US$24.19 in 2026. There's been a pretty noticeable increase in sentiment, with the analysts upgrading revenues and making a substantial gain in earnings per share in particular.

Despite these upgrades,the analysts have not made any major changes to their price target of US$973, suggesting that the higher estimates are not likely to have a long term impact on what the stock is worth. That's not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. There are some variant perceptions on Caterpillar, with the most bullish analyst valuing it at US$1,225 and the most bearish at US$575 per share. This is a fairly broad spread of estimates, suggesting that analysts are forecasting a wide range of possible outcomes for the business.

Looking at the bigger picture now, one of the ways we can make sense of these forecasts is to see how they measure up against both past performance and industry growth estimates. The analysts are definitely expecting Caterpillar's growth to accelerate, with the forecast 11% annualised growth to the end of 2026 ranking favourably alongside historical growth of 7.0% per annum over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to grow their revenue at 6.9% per year. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect Caterpillar to grow faster than the wider industry.

The Bottom Line

The biggest takeaway for us is the consensus earnings per share upgrade, which suggests a clear improvement in sentiment around Caterpillar's earnings potential next year. Happily, they also upgraded their revenue estimates, and are forecasting them to grow faster than the wider industry. The consensus price target held steady at US$973, with the latest estimates not enough to have an impact on their price targets.

Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. We have forecasts for Caterpillar going out to 2028, and you can see them free on our platform here.

You still need to take note of risks, for example - Caterpillar has 1 warning sign we think you should be aware of.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.