Caterpillar on Monday was dowgraded to a Neutral investment rating from Buy by analysts at UBS.
"Our thesis on positive margin inflection is playing out, and we continue to see a positive trajectory for margins and earnings growth from here," according to the report. "However, with multiples compressing as interest rates rise, the valuation price target this time presents a more balanced risk-reward dynamic in our view."
UBS lifted its price target for Caterpillar's stock to $230 from $225 a share.
Caterpillar last week rose more than 15% percent, a gain that included the positive effects of its Q3 earnings report. The maker of earth-moving equipment said earnings had reached a record on strong demand and solid pricing power.
Analysts at Deutsche Bank on Friday downgraded Caterpillar because of several risks, including the possibility of a global recession.
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Caterpillar downgraded to Neutral at UBS on stock's relative value