Caterpillar (NYSE:CAT) is currently the fifth-cheapest stock on the Dow, trading at just 10 times earnings, well below it's historical average of 16. The stock is cheap mainly because it is a highly cyclical company that is vulnerable to the health of the global economy. 

That may not be a great thing nowadays, but this creates opportunity for long-term investors  The company faces some near-term headwinds in its resources industries segment, but still remains positioned well in the segment long-term, especially after its purchase of mining equipment maker Bucyrus. The continuing housing rebound in the U.S. should bode well for Caterpillar in the future.

Analyst Brendan Byrnes further explains in the video below why Caterpillar might just be the best value play on the Dow. 

Andrew: Hi Fools, Andrew Tonner here. I'm joined today by our Analyst, Brendan Byrnes.

Brendan, you look at these things all the time -- broad indexes -- breaking down the Dow, what do you think is the best value play when you look at the 30 components of the Dow Jones index?

Brendan: I ran a screen on Capital IQ and I looked at some of the Dow components. Right now, Caterpillar is trading as the fifth cheapest stock on a price-to-earnings basis right now, at about 10X earnings. I think, for a long-term investor, it's a really attractive stock. Not the best fourth quarter overall; there are some near-term headwinds that I think are keeping this stock cheap.

Number one, commodity prices are down, especially when you look at China and Australia, which obviously hurts mining. The big mining manufacturers aren't going to come in and make big equipment purchases with the cost of commodities where they are right now, but that does create more of an opportunity, I think, to buy this stock at 10 times earnings.

When you look at longer-term tailwinds, construction in the U.S., especially related to housing coming back, which should help Caterpillar quite a bit.

Then, returning to China overall, maybe the next couple of quarters some headwinds with mining, but I think long-term, it's a growth story. Right now, Caterpillar gets 3% of their revenues from China. I think there's clearly a lot of improvement there. They're going to be catching up to Komatsu, or at least trying to.

You've got to watch the Chinese original equipment manufacturers there as they gain steam a little bit, but I think Caterpillar's a solid brand name and -- if they can come in and replicate the kind of quality, dealer, and service networks -- with the brand power, people pay more for Caterpillar products because they understand that they're quality products.

Overall, I think mining, as we talked about ... we looked at General Electric (NYSE:GE) making a big bet on mining with Industrea in Australia, also purchasing another U.S.-based company, Joy Global actually pretty solid earnings in its fiscal first quarter, that just came out.

Overall, I'm bullish on this stock. You might be able to get a slightly better price with some of the near-term headwinds, but I think it's a long-term really solid play to take advantage of the global developing economy. If you're bullish on the overall economy, I think it's a solid bet.