If you’re looking for the best way to play the global economic rebound, sparked by tax cuts in the United States, Caterpillar Inc. (NYSE:CAT) is one way to go.

That’s the general consensus from expert stock-pickers anyway. A couple of key upgrades of CAT stock, along with a pair of increased price targets just within the past month, have bolstered an already amazing rally. All told, Caterpillar stock has gained 73% over the course of the past year, heading into Thursday morning’s earnings report.

Too much bullishness? Nothing left for an encore? It’s admittedly an intimidating move in front of a quarterly-results release. On the flipside, from valuation perspective, the big move simply puts CAT stock back where it needs to be.

Analysts Agree on CAT

There’s a good chance that by the time you’re reading this, Caterpillar will have already dished out its fiscal fourth-quarter 2017 numbers. There’s also a good chance CAT stock has already made a big move in response — up or down. Either way, while the use of common sense is always prudent when picking an entry price, any post-earnings volatility will be irrelevant just a few days from now. After that, it’s still ultimately about long-term earnings growth.

To that end, Seaport Global thinks there’s plenty of that in the cards. The organization raised its opinion on Caterpillar to a “buy” this week. It upped its target on CAT to $195, expecting “high-single-digit if not double-digit revenue growth in 2018.”

Were it just Seaport, the optimism might be dismissible. It’s not just Seaport though.

JPMorgan analyst Ann Duignan also recently upped her opinion of Caterpillar stock, calling it a “overweight” and suggesting shares are worth $200 apiece. Her hot button was the recently-instituted lower tax rates. But Duignan also believes we’re in the early stages of a long-term cycle that favors resources like coal, gold, oil, metals and more.

More Upturn for CAT

That’s a cyclical uptrend many investors may not see, by the way. As Berenberg analyst Rizk Maidi wrote last week, “Just as the mining downturn was more severe than expected, we believe the amplitude of the current upturn is underappreciated … CAT’s mining original equipment (OE) and aftermarket revenues are depressed beyond normal and are set to grow at 25% (compound annual growth rate) through 2020 to make up for five years of under-investments.”

It’s a premise that jibes with observations from Seaport Global’s analysts Michael Shlisky and Jordan Bender. They based much of their optimism on the notion that inventory levels of equipment are too low to meet actual demand.

Indirect rival Deere & Company (NYSE:DE) is experiencing a similar cyclical tailwind.

Analyst opinions about a particular company can be misguided. And a company’s guidance offered to investors can be self-serving. But external data speaks for itself. And the external tailwinds in favor of Caterpillar are undeniable.

One of those tailwinds is a weak — and weakening — U.S. dollar.

Falling Dollar Good for CAT

The U.S. Dollar Index reached a three-year low this week, and is still headed lower. Though the headlines are superficially troubling, as Treasury Secretary Steven Mnuchin explained this week, that bodes well for exporters like Caterpillar as it makes its equipment more affordable to overseas buyers. It matters to current and would-be owners of CAT stock, since more than half its business is driven by foreign customers.

The falling dollar doesn’t just make its heavy equipment cheaper to overseas buyers though. It also lifts the price of commodities like gold and oil. Those are two industries that need big earth-moving equipment.

Ditto for the iron, copper and coal mining industries just to name a few — industries which, by the way, have also mostly enjoyed higher prices for their respective resources. Iron ore pellet prices are up nearly 20% for the past year, while copper prices are up just a little less. Both remain in uptrends though, driven largely by the fundamentals. That is, economic growth is inducing consumption. The United States has seen annualized gross domestic product growth in excess of 3.0% for two quarters in a row — for the first time since 2014 — and this week’s initial look at Q4’s GDP growth rate is expected to be on par with the last couple of readings.

It’s the kind of environment  that encourages purchases of major assets like bulldozers and dump trucks.

Still, a 73% runup over the course of the past 12 months?

Bottom Line for CAT Stock

Don’t sweat it. Caterpillar has worked its way out of a financial hole in recent quarters. And where it’s been for the past year isn’t where it’s going to be a year from now. Its current earnings trajectory translates into a forward-looking P/E of 21.3, which is a price that’s plenty palatable, given all the details, and in the context of all the tailwinds.

That’s not to suggest CAT stock won’t tumble after its fourth-quarter report, nor is it to suggest Caterpillar will be a buy should it soar following Thursday morning’s release. It is to say, however, that no matter the short-term response to that news, Caterpillar is on the right path.

The only real question is finding the optimal entry point.

As of this writing, James Brumley did not hold a position in any of the aforementioned securities. You can follow him on Twitter, at @jbrumley.