CATERPILLAR INC (CAT) Stock Fundamental Analysis
NYSE:CAT - New York Stock Exchange, Inc. - US1491231015 - Common Stock - Currency: USD
We assign a fundamental rating of 5 out of 10 to CAT. CAT was compared to 128 industry peers in the Machinery industry. CAT has an excellent profitability rating, but there are some minor concerns on its financial health. CAT is valued expensive and it does not seem to be growing.
1. Profitability
1.1 Basic Checks
In the past year CAT was profitable.
CAT had a positive operating cash flow in the past year.
In the past 5 years CAT has always been profitable.
Each year in the past 5 years CAT had a positive operating cash flow.
1.2 Ratios
CAT's Return On Assets of 11.70% is amongst the best of the industry. CAT outperforms 84.38% of its industry peers.
With an excellent Return On Equity value of 55.01%, CAT belongs to the best of the industry, outperforming 96.88% of the companies in the same industry.
Looking at the Return On Invested Capital, with a value of 19.67%, CAT belongs to the top of the industry, outperforming 94.53% of the companies in the same industry.
CAT had an Average Return On Invested Capital over the past 3 years of 17.90%. This is significantly above the industry average of 10.71%.
The 3 year average ROIC (17.90%) for CAT is below the current ROIC(19.67%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 11.7% | ||
| ROE | 55.01% | ||
| ROIC | 19.67% |
ROA(3y)10.76%
ROA(5y)8.79%
ROE(3y)50.21%
ROE(5y)41.91%
ROIC(3y)17.9%
ROIC(5y)14.36%
1.3 Margins
Looking at the Profit Margin, with a value of 15.71%, CAT belongs to the top of the industry, outperforming 88.28% of the companies in the same industry.
In the last couple of years the Profit Margin of CAT has grown nicely.
CAT has a better Operating Margin (21.83%) than 92.19% of its industry peers.
In the last couple of years the Operating Margin of CAT has grown nicely.
CAT has a Gross Margin of 37.68%. This is in the better half of the industry: CAT outperforms 68.75% of its industry peers.
CAT's Gross Margin has improved in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 21.83% | ||
| PM (TTM) | 15.71% | ||
| GM | 37.68% |
OM growth 3Y15.96%
OM growth 5Y5.59%
PM growth 3Y9.36%
PM growth 5Y8.01%
GM growth 3Y7.82%
GM growth 5Y3.49%
2. Health
2.1 Basic Checks
CAT has a Return on Invested Capital (ROIC), which is well above the Cost of Capital (WACC), which means it is creating value.
CAT has less shares outstanding than it did 1 year ago.
CAT has less shares outstanding than it did 5 years ago.
Compared to 1 year ago, CAT has a worse debt to assets ratio.
2.2 Solvency
CAT has an Altman-Z score of 4.08. This indicates that CAT is financially healthy and has little risk of bankruptcy at the moment.
CAT has a better Altman-Z score (4.08) than 67.97% of its industry peers.
The Debt to FCF ratio of CAT is 4.90, which is a neutral value as it means it would take CAT, 4.90 years of fcf income to pay off all of its debts.
CAT has a Debt to FCF ratio (4.90) which is in line with its industry peers.
CAT has a Debt/Equity ratio of 1.62. This is a high value indicating a heavy dependency on external financing.
CAT has a Debt to Equity ratio of 1.62. This is amonst the worse of the industry: CAT underperforms 85.94% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.62 | ||
| Debt/FCF | 4.9 | ||
| Altman-Z | 4.08 |
ROIC/WACC2.01
WACC9.79%
2.3 Liquidity
CAT has a Current Ratio of 1.32. This is a normal value and indicates that CAT is financially healthy and should not expect problems in meeting its short term obligations.
Looking at the Current ratio, with a value of 1.32, CAT is doing worse than 82.03% of the companies in the same industry.
A Quick Ratio of 0.77 indicates that CAT may have some problems paying its short term obligations.
CAT has a Quick ratio of 0.77. This is in the lower half of the industry: CAT underperforms 78.91% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.32 | ||
| Quick Ratio | 0.77 |
3. Growth
3.1 Past
The earnings per share for CAT have decreased by -6.16% in the last year.
The Earnings Per Share has been growing by 14.64% on average over the past years. This is quite good.
Looking at the last year, CAT shows a decrease in Revenue. The Revenue has decreased by -5.58% in the last year.
Measured over the past years, CAT shows a small growth in Revenue. The Revenue has been growing by 3.79% on average per year.
EPS 1Y (TTM)-6.16%
EPS 3Y26.49%
EPS 5Y14.64%
EPS Q2Q%-24.11%
Revenue 1Y (TTM)-5.58%
Revenue growth 3Y8.34%
Revenue growth 5Y3.79%
Sales Q2Q%-9.81%
3.2 Future
CAT is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 8.22% yearly.
Based on estimates for the next years, CAT will show a small growth in Revenue. The Revenue will grow by 3.92% on average per year.
EPS Next Y-14.2%
EPS Next 2Y-1.95%
EPS Next 3Y3.03%
EPS Next 5Y8.22%
Revenue Next Year-2.64%
Revenue Next 2Y1.13%
Revenue Next 3Y2.71%
Revenue Next 5Y3.92%
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is stable.
4. Valuation
4.1 Price/Earnings Ratio
The Price/Earnings ratio is 19.15, which indicates a rather expensive current valuation of CAT.
CAT's Price/Earnings ratio is a bit cheaper when compared to the industry. CAT is cheaper than 67.19% of the companies in the same industry.
The average S&P500 Price/Earnings ratio is at 27.15. CAT is valued slightly cheaper when compared to this.
CAT is valuated rather expensively with a Price/Forward Earnings ratio of 18.69.
Compared to the rest of the industry, the Price/Forward Earnings ratio of CAT is on the same level as its industry peers.
CAT is valuated at similar levels of the S&P average when we compare the Price/Forward Earnings ratio to 21.60, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 19.15 | ||
| Fwd PE | 18.69 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of CAT is on the same level as its industry peers.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of CAT is on the same level as its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 23.5 | ||
| EV/EBITDA | 13.4 |
4.3 Compensation for Growth
CAT has an outstanding profitability rating, which may justify a higher PE ratio.
PEG (NY)N/A
PEG (5Y)1.31
EPS Next 2Y-1.95%
EPS Next 3Y3.03%
5. Dividend
5.1 Amount
CAT has a Yearly Dividend Yield of 1.58%. Purely for dividend investing, there may be better candidates out there.
Compared to an average industry Dividend Yield of 1.88, CAT pays a bit more dividend than its industry peers.
CAT's Dividend Yield is slightly below the S&P500 average, which is at 2.42.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.58% |
5.2 History
On average, the dividend of CAT grows each year by 7.41%, which is quite nice.
CAT has paid a dividend for at least 10 years, which is a reliable track record.
CAT has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)7.41%
Div Incr Years11
Div Non Decr Years11
5.3 Sustainability
26.88% of the earnings are spent on dividend by CAT. This is a low number and sustainable payout ratio.
CAT's earnings are growing around the same pace than its dividend. As long as the earnings growth is kept the dividend growth is sustainable.
DP26.88%
EPS Next 2Y-1.95%
EPS Next 3Y3.03%
NYSE:CAT (7/1/2025, 12:27:08 PM)
393.565
+5.36 (+1.38%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryMachinery
Earnings (Last)
Earnings (Next)
Inst Owners72.13%
Inst Owner Change-1.92%
Ins Owners0.18%
Ins Owner Change3.04%
Market Cap185.10B
Analysts75
Price Target377.26 (-4.14%)
Short Float %1.3%
Short Ratio2.39
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.58% |
Yearly Dividend5.41
Dividend Growth(5Y)7.41%
DP26.88%
Div Incr Years11
Div Non Decr Years11
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)-0.9%
Min EPS beat(2)-3.19%
Max EPS beat(2)1.39%
EPS beat(4)2
Avg EPS beat(4)0.3%
Min EPS beat(4)-4.08%
Max EPS beat(4)7.07%
EPS beat(8)6
Avg EPS beat(8)6.5%
EPS beat(12)10
Avg EPS beat(12)9.51%
EPS beat(16)14
Avg EPS beat(16)10.53%
Revenue beat(2)0
Avg Revenue beat(2)-2.9%
Min Revenue beat(2)-3.77%
Max Revenue beat(2)-2.02%
Revenue beat(4)0
Avg Revenue beat(4)-1.9%
Min Revenue beat(4)-3.77%
Max Revenue beat(4)-0.86%
Revenue beat(8)2
Avg Revenue beat(8)-0.87%
Revenue beat(12)5
Avg Revenue beat(12)0.03%
Revenue beat(16)8
Avg Revenue beat(16)0.28%
PT rev (1m)2.06%
PT rev (3m)-3.82%
EPS NQ rev (1m)-0.12%
EPS NQ rev (3m)-6.27%
EPS NY rev (1m)-0.21%
EPS NY rev (3m)-7.22%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)1.42%
Revenue NY rev (1m)-0.17%
Revenue NY rev (3m)-0.9%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 19.15 | ||
| Fwd PE | 18.69 | ||
| P/S | 2.93 | ||
| P/FCF | 23.5 | ||
| P/OCF | 16.42 | ||
| P/B | 10.25 | ||
| P/tB | 14.88 | ||
| EV/EBITDA | 13.4 |
EPS(TTM)20.55
EY5.22%
EPS(NY)21.05
Fwd EY5.35%
FCF(TTM)16.74
FCFY4.25%
OCF(TTM)23.97
OCFY6.09%
SpS134.5
BVpS38.42
TBVpS26.44
PEG (NY)N/A
PEG (5Y)1.31
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 11.7% | ||
| ROE | 55.01% | ||
| ROCE | 26.37% | ||
| ROIC | 19.67% | ||
| ROICexc | 21.01% | ||
| ROICexgc | 23.55% | ||
| OM | 21.83% | ||
| PM (TTM) | 15.71% | ||
| GM | 37.68% | ||
| FCFM | 12.45% |
ROA(3y)10.76%
ROA(5y)8.79%
ROE(3y)50.21%
ROE(5y)41.91%
ROIC(3y)17.9%
ROIC(5y)14.36%
ROICexc(3y)20.33%
ROICexc(5y)16.54%
ROICexgc(3y)22.96%
ROICexgc(5y)18.93%
ROCE(3y)24.59%
ROCE(5y)19.65%
ROICexcg growth 3Y20.44%
ROICexcg growth 5Y6.45%
ROICexc growth 3Y22.47%
ROICexc growth 5Y7.76%
OM growth 3Y15.96%
OM growth 5Y5.59%
PM growth 3Y9.36%
PM growth 5Y8.01%
GM growth 3Y7.82%
GM growth 5Y3.49%
F-Score5
Asset Turnover0.74
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.62 | ||
| Debt/FCF | 4.9 | ||
| Debt/EBITDA | 1.83 | ||
| Cap/Depr | 156.62% | ||
| Cap/Sales | 5.37% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 70.54% | ||
| Profit Quality | 79.23% | ||
| Current Ratio | 1.32 | ||
| Quick Ratio | 0.77 | ||
| Altman-Z | 4.08 |
F-Score5
WACC9.79%
ROIC/WACC2.01
Cap/Depr(3y)136.89%
Cap/Depr(5y)120.55%
Cap/Sales(3y)4.65%
Cap/Sales(5y)4.77%
Profit Quality(3y)84.51%
Profit Quality(5y)93.37%
High Growth Momentum
Growth
EPS 1Y (TTM)-6.16%
EPS 3Y26.49%
EPS 5Y14.64%
EPS Q2Q%-24.11%
EPS Next Y-14.2%
EPS Next 2Y-1.95%
EPS Next 3Y3.03%
EPS Next 5Y8.22%
Revenue 1Y (TTM)-5.58%
Revenue growth 3Y8.34%
Revenue growth 5Y3.79%
Sales Q2Q%-9.81%
Revenue Next Year-2.64%
Revenue Next 2Y1.13%
Revenue Next 3Y2.71%
Revenue Next 5Y3.92%
EBIT growth 1Y-8.1%
EBIT growth 3Y25.63%
EBIT growth 5Y9.59%
EBIT Next Year-1.31%
EBIT Next 3Y3.26%
EBIT Next 5Y8.31%
FCF growth 1Y23.9%
FCF growth 3Y23.12%
FCF growth 5Y15.76%
OCF growth 1Y24.88%
OCF growth 3Y18.69%
OCF growth 5Y11.73%