These two companies are known for having cyclical earnings and two stocks that have both had excellent years and trounced the S 500 index. But between copper miner Freeport-McMoRan (NYSE: FCX) and heavy equipment company (NYSE: CAT), which is the better buy now? Let's take a closer look. 

The equipment company is probably harder to understand, so I'll start with it and its recent barnstorming set of second-quarter earnings. The earnings exceeded analyst expectations, and management's full-year outlook impressed. For example, adjusted operating profit is expected to come in at the top end of management's targeted range, and more importantly, its machinery, energy, and transportation free cash flow (FCF) is expected to be around the top of its target range of $4 billion to $8 billion range. 

In case you are wondering, management's $4 billion to $8 billion range reflects the cyclical nature of its business and is supposed to frame the low and high end of FCF performance through the cycle. I'll come back to this point in a moment, but let's focus on where Caterpillar is outperforming and what to expect in the future. 

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Source Fool.com