Caterpillar Inc. (NYSE: CAT) has had a positive year so far, with its shares last seen trading up about 10%. Earnings were far better than expected and many analysts have raised their price targets and ratings in recent weeks and months.

Now Merrill Lynch is getting in on the action and joining the Caterpillar upgrade brigade. While a 10% gain in 2017 is huge, that is actually the 11th best gain out of the 30 Dow Jones Industrial Average components.

Merrill Lynch’s Ross Gilardi raised Caterpillar to Buy from Neutral, and the firm’s price objective was raised to $120 from $105 in that call. The brokerage firm noted that Caterpillar’s monthly retail sales continue to accelerate, that it may raise its dividend over the summer and that it may have another big earnings beat in July.

The firm also raised its 2017 and 2018 earnings estimates by 30% to 35%. Merrill Lynch is actually about 15% above Caterpillar’s guidance and 8% above the consensus. The firm also raised its 2017 to 2019 per-share earnings estimates to $4.30 (from $3.20), $5.50 (from $4.25) and $6.85 (from $6.00), respectively.

Merrill Lynch’s investment rationale said that:

Caterpillar is a global powerhouse in mining, construction and power systems equipment, and also that it is very well positioned for the long term. The firm sees opportunities for operating leverage to surprise to the upside as revenue turns positive over the next year. Mining and off-highway markets remain challenging, but we think the worst of the downturn in these end markets is behind us and expect the recent pickup in spare parts activity to persist in advance of the eventual turn in new equipment demand.

Shares of Caterpillar were last seen up 1% at $101.49 on Thursday, with a consensus analyst price target of $105.98 and a 52-week trading range of $69.04 to $105.90

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