The company’s shares have risen to record levels in recent weeks, pushing its market capitalization even higher—from $270 billion at the end of 2025 to about $347 billion as of February 10. The stock, which has nearly doubled in the past 12 months to an all-time high of $742, has outperformed technology like Behem. Apple (up 20%) and Microsoft (about 1%). And investors are betting that Caterpillar’s growing exposure to data centers, energy infrastructure, and AI-related demand has yet to peak. In fact, in the last 12 months, Caterpillar ranked as the No. 1 best performer on the Dow.

While Caterpillar is best known for its bright yellow construction site vehicles, it has greatly expanded its business mix to include energy and power systems, and resource and mining equipment. Caterpillar CEO Joseph Creed first joined the company in 1997 and has served in various roles, including CFO for the energy and transportation segment and interim CFO. Creed was named Caterpillar’s chief operating officer in 2023 and became CEO on May 1, 2025.

The company’s strategy “centers on three pillars for profitable growth: commercial excellence, being an advanced technology leader, and transforming how we work—all built on a foundation of continuous operational excellence,” Creed said in a Jan. 29 earnings call.

Worms (No. 64 of the Fortune 500) reported fourth-quarter and full-year results that exceeded Wall Street expectations. Full-year sales and revenue reached a record $67.6 billion, the highest in company history, driven by solid demand across the construction, resources, and energy businesses. Adjusted earnings per share (EPS) for the year totaled $19.06, while fourth-quarter adjusted EPS came in at approximately $5.16, above analysts’ forecasts in the mid-$4 range.

The company also reported a record order backlog of $51 billion, which is about 70% from a year ago, highlighting the strong visibility of demand entering 2026. Total full-year sales increased 4% compared to last year, and Caterpillar generated strong free cash flow, further strengthening its balance sheet.

“Shares have risen sharply in the past year as investors weigh the company’s exposure to growing demand for artificial intelligence,” Morningstar equity analyst George Maglares wrote in a recent note.

Rather than developing AI technology itself, Caterpillar supplies the critical equipment needed to operate and support AI-driven infrastructure. The company provides turbines for on-site primary power in data centers, generator sets for backup power, and integrated microgrid systems that can combine traditional energy sources with renewables and battery storage, Fortune’s Jordan Blum reported.

Maglares noted that Caterpillar’s construction industries and resource industry segments are both showing signs of cyclical recovery. The company exited the year with double-digit growth in all major segments, suggesting strong momentum heading into 2026. Management is guiding for mid-single-digit revenue growth of roughly 5% to 7% for the current year, a forecast that Morningstar views as potentially conservative given current demand trends.

Infrastructure spending in North America remains a key driver, especially as public sector projects and private investment in energy and digital infrastructure continue to expand, he said. Reflecting these trends, Morningstar recently raised its fair value estimate for Caterpillar shares to the lower $600 range, citing improved guidance and stronger demand at the end of the market.

The company’s evolving revenue mix also underpins its shift toward energy and power solutions. By 2024, Caterpillar’s energy and transportation segment will generate about $28.8 billion in annual revenue, surpassing the $25.5 billion the company reported in its traditional construction industry business for the first time, luck THE audience. The change highlights the growing importance of power generation and energy systems within Caterpillar’s portfolio.

The worm, which celebrated its 100th anniversary last year, is still a cyclical business that rises and falls with the global economy. But for now, Caterpillar may be the most surprising beneficiary of a boom that doesn’t seem like it’s going to stop anytime soon.