these reports excerpted and edited by barron’s were issued recently by investment and research firms the reports are a sampling of analysts’ thinking they should not be considered the views or recommendations of barron’s some of the reports’ issuers have provided or hope to provide investmentbanking or other services to the companies being analyzed we believe that caterpillar’s earning power and free cash flow over this coming cycle supported by solid global grossdomesticproduct growth merit our overweight rating the company has cut fixed costs by restructuring its resource business which should provide earnings upside as volumes recover in what we expect to be a multiyear upcycle in mining also we view caterpillar as the biggest winner of an extended us construction cycle our december 2022 price target of 248 represents about 18 times our 2023 earningspershare estimate a multiple compressing toward its longterm average around 16 times much has been written about the expected fiveyear infrastructure bill and the impact on constructionequipment spending the bill includes an increase of about 35 in spending on highways over the current annual authorization of 464 billion but historically constructionequipment sales were most highly correlated with residential construction while that may change this cycle the fundamentals still favor a solid upcycle in which nonresidential construction spending lags behind residential by 18 to 24 months our analysis suggests that the equipment cycle remains in the early stages with normal demand likely in 2022 and a peak in 2024 the food and drug administration has completed its longawaited review of the final data from a study of pfizer’s ticker pfe xeljanz in highrisk patients with rheumatoid arthritis these patients had higher rates of cardiovascular side effects and malignancies than those treated with tnf inhibitors other drugs used to stop inflammation the fda concludes that abbvie’s rinvoq and eli lilly’s lly olumiant may have similar risks we wait to see how the fda handles the ongoing regulatory review of rinvoq and competing drugs in atopic dermatitis and other indications but believe investors are pricing in a worstcase scenario for rinvoq while missing the other attractive parts of the abbvie story we reiterate our buy rating price target 131 okta which sells online identityconfirmation software to businesses delivered a strong quarter outperforming expectations with topline strength flowing through to margins and free cash flow guidance moved higher as okta’s goal remains 35 revenue growth through its fiscal2026 year and 20 fcf margins we maintain our 300 price target we are raising our eps estimates based on higher forecasts for otter tail’s plastics division which we believe can continue to benefit from low resin supplies and high demand for polyvinyl chloride or pvc pipes for the housing market multiple petrochemical facilities in the gulf coast temporarily shut down during hurricane ida this will support resin prices we increase our 2021 eps estimate to 368 from 354 versus otter tail’s guidance of 350 to 365 although the shares continue to reach 52week highs they remain below their peak levels reached in 2019 trading at 19 times our 2022 eps estimate of 296 the stock has a dividend yield of 28 we are raising our price target to 67 from 64—22 times our 308 2023 eps estimate we are initiating coverage of gxo with 2021 2022 and 2023 estimates of ebitda earnings before interest taxes depreciation and amortization of 625 million 730 million and 795 million respectively and eps estimates of 175 235 and 270 gxo is positioned to capitalize on favorable trends in supplychain outsourcing particularly for ecommerce and omnichannel clients we view its revenue as stable given the longerterm nature of its contracts and see potential for modest margin expansion as technology applications and further automation are more fully implemented across the business lastly gxo’s free cash generation and low balancesheet leverage support organic and inorganic growth that said valuation may represent a hurdle synaptics which makes wirelesstechnology products among other things plans to acquire dsp group dspg for 22 a share in a transaction expected to close by year end the acquisition will add fastgrowing ultralowenergy and smart voice solutions to the synaptics portfolio while opening room for crossselling of legacy products cordless faxesprinters combined with synergies we see the transaction adding about 70 cents to 80 cents of eps or about 125 after all acquisition debt is paid down with this positive development we are reiterating our 220 price target to be considered for this section material should be sent to researchbarronscom