Caterpillar Trades at 3x Its Historical Multiple — Michael Burry Is Betting Against It

Caterpillar (CAT) has seen significant growth due to the demand for power generation in AI data centers, boasting a record backlog and strong Q1 2026 results. Despite its strong performance and role in addressing the US electrical grid strain, Michael Burry has taken a short position, arguing that its current valuation (trading at 3x its historical multiple) is unsustainable for a cyclical heavy equipment manufacturer, especially with rising costs and tariffs. While hedge funds like Fisher Asset Management maintain significant stakes, Burry's bet highlights concerns about CAT's long-term earnings sustainability at software-like multiples.