Meta, SpaceX fuel industrial boom: Caterpillar backlog hits record $63B

The race to build massive AI data centers—exemplified by Meta's 5-gigawatt facility and SpaceX's Colossus leasing operations—is creating an unexpected tailwind for traditional industrial manufacturers. Caterpillar and Eaton, companies that operate far outside the consumer tech spotlight, are positioned directly in the supply chain for this infrastructure boom. Caterpillar supplies the heavy construction equipment required to build these "massive structures," as well as on-site power generators that address the grid-strain issue created by data center electricity demands. Eaton's electrical power management products form the backbone of data center infrastructure. The body indicates that both companies face a similar dynamic: strong backlogs (Caterpillar at record levels, Eaton up over 40%) signal that orders are already flowing in, making future revenues predictable. However, the article notes a valuation concern: Wall Street's intense focus on AI has already driven up both stocks' multiples—Caterpillar to 45× earnings and Eaton to 38×—making them unattractive to value-focused investors despite the underlying strength of their order books. The article suggests the data center build-out is still in early innings, implying the demand tailwind may persist, but the elevated entry valuations complicate the investment case.