Dark period for Caterpillar: downgraded from buy to hold

Global securities and investment banking group Jefferies downgraded Caterpillar (NYSE:CAT) from a “buy” to a “hold” rating, with a price target of $85.00, in a report released on Wednesday.

The giant producer of construction and mining equipment saw its price target fall from $130.00 to $85.00, driven mainly by a drop in the construction markets outside of the USA, but the research analysts also took into account the weaker outlook for EAME, Latin America and mining worldwide.

It’s been a tough month for the machinery maker. In early July, Wells Fargo removed the company from its priority stock list, reiterating an “outperform” rating on shares of Caterpillar in a research note to investors.

Last Wednesday, analysts at Longbow Research downgraded shares of Caterpillar from a “buy” rating to a “neutral” rating in a note to investors. Separately, analysts at Credit Suisse cut their price target on shares of Caterpillar to $120.00 in a research note to investors on Friday, July 13th.

Caterpillar was also removed from the socially responsible share index, managed by US investment firm MSCI, early this month over Israeli use of Caterpillar made bulldozers for demolition in Palestine.

MSCI’s decision spurred TIAA-CREF, a US mutual fund giant, to withdraw $72 million in Caterpillar shares from its "Social Choice" Fund, which tracks one of MSCI's indexes.

The earth-moving equipment maker was not the only one affected by Jefferies & Co report. The firm also cut its ratings and targets on a number of U.S. machinery companies, including Eaton Corp, CNH Global, Kennametal, Parker Hannifin and Titan International.