BMO Capital analyst Joel Tiss weighs in on Caterpillar Inc. (NYSE:CAT) after spending two days with management, listening to investors trying to figure out if the stock is at a bottom yet.

Tiss maintains that there are signs of pent-up demand for the company’s product. He explains, “Excluding mining equipment, where sales are down roughly $15 billion from the 2012 peak, the rest of Caterpillar’s businesses are down closer to 20% (or about $10 billion) versus average cycles that typically decline for three years and see 35%-type drops.”

The analyst concedes that, despite the possibility of pent-up demand, there could be continued limitation preceding a turnaround. He notes, “These big, broad numbers do not tell an accurate story but do give some sense that there could be more weakness ahead before we see any recovery, as mining, energy, power generation, and anything else commodity related is very depressed.”

In closing, the analyst reiterates a Market Perform rating on the stock with a price target of $72.00, concluding, “Despite the negative outlook for the various end markets, we believe Caterpillar is a world-class company that has done an excellent job of managing through a difficult environment. Until we have a better sense of when demand will improve, we remain comfortable with our Market Perform.”

According to TipRanks, Joel Tiss is ranked #603 of 4,101 analysts on TipRanks. He maintains a 62% success rate and realizes an average return of 7.4%. When rating CAT, the analyst upholds a 0% success rate and achieves an average loss of 8.6%.

Out of the 18 analysts polled by TipRanks, 4 rate Caterpillar stock a Buy, 12 rate the stock a Hold and 2 recommend a Sell. With a downside potential of 12.5%, the stock’s consensus target price stands at $72.88.

Recommended Article: Jefferies Weighs in on Caterpillar Inc. (CAT) Following Meeting with Management