UPDATE: JPMorgan Upgrades Caterpillar to Overweight on Low Risk

In a Tuesday report, JPMorgan analyst Ann Duignan upgraded Caterpillar Inc.

to an Overweight rating and lifted its price target from $93 to $100. Duignan wrote, "We are upgrading CAT from Neutral to Overweight, as we believe that most of the downside risk has been priced into the stock at this point, and that risk/reward favors owning the stock. Our analysis on mining capex has provided us a clearer framework for the cycle, and although our outlook on the basic materials space remains negative, we are more comfortable calling near-trough in Resource revenue and margins in 2013 given CAT's underproduction. Moreover, excavator sales data in China suggests that despite flagging economic data out of the country in recent months, a clear selling season is occurring, which should help abate the headline risk in the region. While several risks remain, including deterioration in the macro environment, a deeper and longer mining capex decline as well as the risk of higher interest rates, we believe that at the current valuation, the stock more than reflects these risks." Caterpillar closed Monday at $82.71.