CATERPILLAR INC (CAT) Stock Fundamental Analysis
NYSE:CAT - New York Stock Exchange, Inc. - US1491231015 - Common Stock - Currency: USD
CAT gets a fundamental rating of 5 out of 10. The analysis compared the fundamentals against 128 industry peers in the Machinery industry. While CAT belongs to the best of the industry regarding profitability, there are some minor concerns on its financial health. CAT does not seem to be growing, but still is valued expensively.
1. Profitability
1.1 Basic Checks
In the past year CAT was profitable.
In the past year CAT had a positive cash flow from operations.
In the past 5 years CAT has always been profitable.
In the past 5 years CAT always reported a positive cash flow from operatings.
1.2 Ratios
With an excellent Return On Assets value of 11.70%, CAT belongs to the best of the industry, outperforming 84.38% of the companies in the same industry.
CAT has a Return On Equity of 55.01%. This is amongst the best in the industry. CAT outperforms 96.88% of its industry peers.
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 10.69%.
The last Return On Invested Capital (19.67%) for CAT is above the 3 year average (17.90%), which is a sign of increasing profitability.
| 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
CAT has a Profit Margin of 15.71%. This is amongst the best in the industry. CAT outperforms 88.28% of its industry peers.
CAT's Profit Margin has improved in the last couple of years.
CAT has a Operating Margin of 21.83%. This is amongst the best in the industry. CAT outperforms 92.19% of its industry peers.
In the last couple of years the Operating Margin of CAT has grown nicely.
Looking at the Gross Margin, with a value of 37.68%, CAT is in the better half of the industry, outperforming 68.75% of the companies in the same industry.
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
With a Return on Invested Capital (ROIC) well above the Cost of Capital (WACC), CAT is creating value.
The number of shares outstanding for CAT has been reduced compared to 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
An Altman-Z score of 4.15 indicates that CAT is not in any danger for bankruptcy at the moment.
CAT has a better Altman-Z score (4.15) than 67.97% of its industry peers.
CAT has a debt to FCF ratio of 4.90. This is a neutral value as CAT would need 4.90 years to pay back of all of its debts.
CAT has a Debt to FCF ratio of 4.90. This is comparable to the rest of the industry: CAT outperforms 53.91% of 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's Debt to Equity ratio of 1.62 is on the low side compared to the rest of the industry. CAT is outperformed by 85.94% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.62 | ||
| Debt/FCF | 4.9 | ||
| Altman-Z | 4.15 |
ROIC/WACC2.03
WACC9.68%
2.3 Liquidity
A Current Ratio of 1.32 indicates that CAT should not have too much problems paying its short term obligations.
CAT has a worse Current ratio (1.32) than 82.81% of its industry peers.
A Quick Ratio of 0.77 indicates that CAT may have some problems paying its short term obligations.
CAT's Quick ratio of 0.77 is on the low side compared to the rest of the industry. CAT is outperformed by 79.69% 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.
CAT shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 14.64% yearly.
The Revenue has decreased by -5.58% in the past year.
CAT shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 3.79% yearly.
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
Based on estimates for the next years, CAT will show a quite strong growth in Earnings Per Share. The EPS will grow by 8.22% on average per year.
The Revenue is expected to grow by 3.92% on average over the next years.
EPS Next Y-14.08%
EPS Next 2Y-1.67%
EPS Next 3Y3.07%
EPS Next 5Y8.22%
Revenue Next Year-2.98%
Revenue Next 2Y1.02%
Revenue Next 3Y2.57%
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.
The Revenue growth rate is stable: in the next years the growth will be about the same than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
CAT is valuated rather expensively with a Price/Earnings ratio of 19.75.
Based on the Price/Earnings ratio, CAT is valued a bit cheaper than 68.75% of the companies in the same industry.
The average S&P500 Price/Earnings ratio is at 27.30. CAT is valued slightly cheaper when compared to this.
CAT is valuated rather expensively with a Price/Forward Earnings ratio of 19.17.
The rest of the industry has a similar Price/Forward Earnings ratio as CAT.
CAT's Price/Forward Earnings ratio indicates a similar valuation than the S&P500 average which is at 21.76.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 19.75 | ||
| Fwd PE | 19.17 |
4.2 Price Multiples
CAT's Enterprise Value to EBITDA ratio is in line with the industry average.
CAT's Price/Free Cash Flow ratio is in line with the industry average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 24.24 | ||
| EV/EBITDA | 13.92 |
4.3 Compensation for Growth
CAT has an outstanding profitability rating, which may justify a higher PE ratio.
PEG (NY)N/A
PEG (5Y)1.35
EPS Next 2Y-1.67%
EPS Next 3Y3.07%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 1.48%, CAT has a reasonable but not impressive dividend return.
CAT's Dividend Yield is a higher than the industry average which is at 1.81.
CAT's Dividend Yield is slightly below the S&P500 average, which is at 2.35.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.48% |
5.2 History
The dividend of CAT is nicely growing with an annual growth rate of 7.41%!
CAT has paid a dividend for at least 10 years, which is a reliable track record.
CAT has not decreased their dividend for at least 10 years, which is a reliable track record.
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-1.67%
EPS Next 3Y3.07%
405.92
-2.41 (-0.59%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryMachinery
Earnings (Last)
Earnings (Next)
Inst Owners72.13%
Inst Owner Change0.02%
Ins Owners0.18%
Ins Owner Change3.04%
Market Cap190.91B
Analysts75
Price Target377.26 (-7.06%)
Short Float %1.3%
Short Ratio2.39
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.48% |
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)0.06%
PT rev (3m)-3.19%
EPS NQ rev (1m)-0.72%
EPS NQ rev (3m)-5.14%
EPS NY rev (1m)-0.08%
EPS NY rev (3m)-7.1%
Revenue NQ rev (1m)-0.89%
Revenue NQ rev (3m)1.17%
Revenue NY rev (1m)-0.44%
Revenue NY rev (3m)-0.32%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 19.75 | ||
| Fwd PE | 19.17 | ||
| P/S | 3.02 | ||
| P/FCF | 24.24 | ||
| P/OCF | 16.94 | ||
| P/B | 10.57 | ||
| P/tB | 15.35 | ||
| EV/EBITDA | 13.92 |
EPS(TTM)20.55
EY5.06%
EPS(NY)21.17
Fwd EY5.22%
FCF(TTM)16.74
FCFY4.13%
OCF(TTM)23.97
OCFY5.9%
SpS134.5
BVpS38.42
TBVpS26.44
PEG (NY)N/A
PEG (5Y)1.35
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 | 4.15 |
F-Score5
WACC9.68%
ROIC/WACC2.03
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-14.08%
EPS Next 2Y-1.67%
EPS Next 3Y3.07%
EPS Next 5Y8.22%
Revenue 1Y (TTM)-5.58%
Revenue growth 3Y8.34%
Revenue growth 5Y3.79%
Sales Q2Q%-9.81%
Revenue Next Year-2.98%
Revenue Next 2Y1.02%
Revenue Next 3Y2.57%
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%