For Immediate Release
Chicago, IL – June 15, 2026 – Zacks Equity Research shares Caterpillar CAT as the Bull of the Day and RH RH as the Bear of the Day. In addition, Zacks Equity Research provides analysis on Micron Technology MU and NVIDIA Corp. NVDA.
Here is a synopsis of all four stocks.
Bull of the Day:
Zacks Rank #1 (Strong Buy) company Caterpillar, known for its iconic yellow machines, is the largest global construction and mining equipment manufacturer. Given that it serves a gamut of sectors - infrastructure, construction, mining, oil & gas and transportation, the company is considered a bellwether of the global economy.
Since 1925, Caterpillar’s product portfolio has evolved and boasts 20 brands and generated revenues of $67.6 billion in 2025. It has more than 4 million products with an extensive dealer network of 156 dealers spanning 190 countries.
Caterpillar started using telematics in the 1990s and reached its target of 1 million connected assets in 2019. It currently has more than 1.5 million connected assets. The combination of innovation, and cutting-edge technology, coupled with the formidable reputation, set Caterpillar apart from its peers.
Benefitting from the AI Data Center Boom
The artificial intelligence and cloud computing boom has transformed this legacy industrial giant into a crucial "picks and shovels" player for the physical layer of the AI revolution. The defining challenge for hyperscale AI data centers is securing enough electrical power, and connecting a massive campus to the traditional utility grid can take years due to regulatory hurdles, transmission line shortages, and grid capacity constraints.
To bypass these delays, data center developers are increasingly choosing to skip the grid entirely or build decentralized, on-site power infrastructure to accelerate their time to market, which has sparked an unprecedented surge in demand for Caterpillar's Energy & Transportation segment. Developers are deploying massive arrays of Caterpillar's natural gas and diesel reciprocating engines, as well as industrial gas turbines through its Solar Turbines subsidiary, to generate electricity directly on-site and provide the continuous, high-output baseload reliability that compute-heavy AI workloads demand.
Record Backlog Provides Future Revenue Visibility
Caterpillar’s backlog rose to a record $63 billion at the end of first-quarter 2026, up 79% year over year, supported by all three primary segments and all-time record order intake. Management raised its full-year 2026 outlook to low double-digit sales compared with the earlier expectation of growth near the upper end of its long-term 5-7% CAGR target. The company also expects services revenue growth for the year.
Notably, the company also updated its previously provided long-term target provided at its investor day of CAGR of 5-7% through 2030 to 6-9%. In North America, demand from residential and non-residential construction should support Caterpillar’s construction equipment sales in the long run. U.S. infrastructure investment in roads, bridges, airports and waterways remains an opportunity for Caterpillar given the breadth of its construction portfolio.
Increased construction activity will also support demand in EAME and Latin America. Caterpillar plans to increase Construction Industries’ sales to users to 1.25x by 2030, compared to 2024. Meanwhile, Zacks Consensus Estimates suggest double-digit EPS growth through next year.
Mining Cycle Support and Autonomous Expansion
Miners are bringing radical changes to mining operations to increase productivity, reduce cost and improve frontline safety and are, thus, increasingly relying on autonomous systems. Electric vehicle demand is also boosting demand for commodities. The intensifying global focus on shifting from fossil fuels to zero emissions will require a huge number of commodities, which in turn, will boost demand for Caterpillar’s mining equipment.
Also, favorable trends in commodity prices bode well for mining equipment demand. Caterpillar is enhancing its autonomous capabilities and bringing innovative products into the markets to capitalize on this demand. Caterpillar acquired RPMGlobal in February 2026, expanding its portfolio of data-driven mining technology and software solutions that help customers plan, operate and manage their sites more efficiently. This aligns with the company’s broader autonomy roadmap. The company plans to triple the number of autonomous trucks in Resource Industries from 2025 levels by 2030.
Bullish Technical Set Up
CAT shares are retreating to the rising 50-day moving average, offering a high probability reward-to-risk zone.
Bottom Line
Caterpillar is exceptionally positioned for sustained long-term growth as a global economic bellwether.
Bear of the Day:
Zacks Rank #5 (Strong Sell) company RH is a leading luxury retailer in the home furnishing space. The company offers dominant merchandise assortments across a growing number of categories, including furniture, lighting, textiles, bathware, décor, outdoor and garden, tableware and child and teen furnishings.
RH’s business is fully integrated across its multiple channels of distribution, consisting of stores, Source Books and websites. RH positions its Galleries as showrooms for its brand, while websites and Source Books act as virtual extensions of its physical spaces. RH has an integrated RH Hospitality experience in ten of the Design Gallery locations, which include restaurants and wine bars.
RH Faces Tariff Uncertainty & Rising Cost Pressures
RH faces significant headwinds from tariffs that continue to disrupt operations and weigh on financial visibility. With about 16 different tariff announcements over the past 10 months, RH has been facing significant resourcing challenges, product delays and out-of-stocks, along with multiple rounds of price negotiations and increases.
Tariff-related resourcing has also impacted key categories such as furniture, lighting and rugs, which are more complex to shift across manufacturing locations. The elevated tariffs of 50% on imported steel and aluminum, with a new investigation into furniture imports, burden the company’s cost structure. These cost burdens not only threaten margins but also create timing distortions in revenue recognition. In the fourth quarter of fiscal 2025, tariffs remained a key driver of margin pressure, with an impact of around 90 basis points.
RH: Dependent on Housing Market
RH and other industry peers are highly dependent on housing market demand. The housing industry is cyclical and affected by consumer confidence levels, prevailing economic conditions and interest rates. The federal government’s actions related to economic stimulus, taxation and borrowing limits could affect consumer confidence and spending levels, which could hurt both the economy and the housing market.
Bottom Line
While RH maintains a sophisticated, fully integrated luxury brand identity and continues to innovate through its unique blend of retail and hospitality, its near-term outlook is increasingly challenged by external economic pressures. The convergence of persistent tariff burdens, supply chain bottlenecks, and an unpredictable, interest-rate-sensitive housing market presents a demanding operating environment. Moving forward, RH's ability to maintain its premium margins and sustain revenue growth will heavily depend on how effectively it navigates these macroeconomic headwinds and mitigates ongoing cost volatility.
Additional content:
Micron vs. NVIDIA: One AI Stock Is a Clear Buy Right Now
Riding the artificial intelligence (AI) boom, Sanjay Mehrotra-led Micron Technology outpaced Jensen Huang-led NVIDIA Corp. over the past year, rising 761.5% compared to NVIDIA’s 44.3%. Let us thus see how both companies performed and whether Micron holds an investment edge over NVIDIA –
The Bullish Case for MU Stock
Micron reported revenues of $23.86 billion in the fiscal second quarter of 2026 and expects revenues to improve further to $33.5 billion in the fiscal third quarter, according to investors.micron.com. As hyperscalers increase their spending on AI infrastructure, Micron’s advanced high-bandwidth memory (“HBM”) chips are witnessing high demand, supporting revenue growth.
The present supply-demand imbalance in HBM chips gives Micron strong pricing power and underpins a strong long-term growth outlook. Nonetheless, the HBM chips are in demand due to their capability to manage complex workloads while delivering improved power efficiency.
Also, constrained supply in NAND flash chips is expected to continue through the middle of next year, which could further boost margins. Micron expects a solid gross margin of around 81% for the fiscal third quarter of 2026, showcasing strong financial momentum.
The Bullish Case for NVDA Stock
NVIDIA’s latest strong Data Center performance demonstrated its position as a leader in hyperscale AI infrastructure investment worldwide. In the fiscal first quarter of 2027, NVIDIA’s Data Center segment generated a record $75.2 billion in revenues, up 92% year over year and 21% sequentially, according to nvidia.news.nvidia.com.
NVIDIA reported revenues of $81.6 billion in the fiscal first quarter of 2027, a new record, up 85% from a year ago and 20% sequentially. Despite its massive size, NVIDIA’s revenues continue to grow, driven by strong demand for its cutting-edge AI chips, networking solutions, and data center infrastructure that support large-scale AI training and inference workloads. NVIDIA projects fiscal second-quarter of 2027 revenues of $91 billion, plus or minus 2%.
Additionally, NVIDIA continues to deliver strong margins, reflecting its pricing power in graphics processing units (GPUs) and AI accelerators, while maintaining sustained demand for its products across the AI and data center markets. For the fiscal first quarter of 2027, NVIDIA’s non-GAAP gross margin was 75%, and is expected to remain near 75% for the fiscal second quarter of 2027, a tell-tale sign that the company is capable of maintaining strong profitability.
Micron Has the Edge: Why It’s a Better AI Buy Than NVIDIA Now
Strong AI-infrastructure demand is currently driving the bullish outlook for both Micron and NVIDIA. However, Micron appears to offer a more attractive valuation than NVIDIA at the current levels.
Per the price/earnings ratio, MU trades at 16.65 forward earnings compared with NVDA’s forward earnings multiple of 22.97. Since NVIDIA trades at a premium valuation, the company needs to deliver strong growth to justify further upside. On the other hand, Micron can outperform through steady and sustainable earnings growth.
Additionally, Micron is no longer viewed as a traditional cyclical memory company; it has elevated itself to become a key supplier in the AI infrastructure ecosystem. Micron has sold a significant amount of its HBM capacity through 2026 amid strong AI-driven demand. The HBM supply constraint has given the company a strong pricing power, boosting profit margins, improving revenue visibility and creating further upside potential for the stock.
In contrast, much of NVIDIA’s strong quarterly performance already appears reflected in its share price, and the ongoing China-related export curbs could create pressure on future growth. Therefore, currently Micron looks like the more compelling investment opportunity.
While Micron has a Zacks Rank #1 (Strong Buy), NVIDIA has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank stocks here.
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