This Construction Giant's Stock Led the Dow Over the Past Year. It's Gotten a Boost From AI

America's construction and farming equipment giant Caterpillar has become a big beneficiary of the AI boom.

Shares of Caterpillar (CAT) climbed 3.4% to close at a record high above $665 Thursday, after the company posted quarterly results that topped estimates, thanks in part to strong demand for machinery and equipment to build out AI data centers.

The latest gains extend a blistering rally for Caterpillar's stock that's seen the shares surge 16% in January so far. They've added more than three-quarters of their value over the past 12 months, making Caterpillar the Dow Jones Industrial Average's top performer over the period.

Caterpillar on Thursday morning reported an adjusted $5.16 per share on a 18% year-over-year rise in revenue to $19.1 billion for the fourth quarter. Both figures topped analysts' projections compiled by Visible Alpha.

Sales in the company's construction industries segment grew 15%, while the power generation portion of Caterpillar's power and energy division that makes large engines and generators used to power data centers saw revenue surge 44%.

CEO Joe Creed said during Thursday's earnings call that Caterpillar expects investments in data centers "will further bolster overall construction spending" this year, according to a transcript from AlphaSense.

Related Education

Guide to Selecting the Best Artificial Intelligence Stocks

4 Leading Data Center Stocks

Wall Street analysts are somewhat divided on whether Caterpillar's stock has room to rise, however. Though ratings are still in flux, the nine analysts with current ratings tracked by Visible Alpha are split between five "buy" and four "hold" ratings. With Thursday's gains, the stock has climbed past their mean target around $662.