CATERPILLAR INC (CAT)
US1491231015 - Common Stock
We assign a fundamental rating of 6 out of 10 to CAT. CAT was compared to 132 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 has a correct valuation and a medium growth rate.
1. Profitability
1.1 Basic Checks
CAT had positive earnings in the past year.
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
CAT's Return On Assets of 13.43% is amongst the best of the industry. CAT outperforms 90.00% of its industry peers.
CAT has a better Return On Equity (63.77%) than 98.46% of its industry peers.
CAT's Return On Invested Capital of 21.21% is amongst the best of the industry. CAT outperforms 96.92% of its industry peers.
The Average Return On Invested Capital over the past 3 years for CAT is above the industry average of 10.78%.
The last Return On Invested Capital (21.21%) for CAT is above the 3 year average (14.39%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 13.43% | ||
| ROE | 63.77% | ||
| ROIC | 21.21% |
ROA(3y)9.28%
ROA(5y)7.89%
ROE(3y)44.88%
ROE(5y)39.19%
ROIC(3y)14.39%
ROIC(5y)12.73%
1.3 Margins
CAT has a Profit Margin of 16.79%. This is amongst the best in the industry. CAT outperforms 91.54% of its industry peers.
CAT's Profit Margin has improved in the last couple of years.
CAT has a Operating Margin of 22.43%. This is amongst the best in the industry. CAT outperforms 95.38% 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 37.03%, CAT is in the better half of the industry, outperforming 72.31% of the companies in the same industry.
CAT's Gross Margin has improved in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 22.43% | ||
| PM (TTM) | 16.79% | ||
| GM | 37.03% |
OM growth 3Y18.73%
OM growth 5Y5.1%
PM growth 3Y28.99%
PM growth 5Y6.53%
GM growth 3Y6.13%
GM growth 5Y2.15%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is well above the Cost of Capital (WACC), so CAT is creating value.
Compared to 1 year ago, CAT has less shares outstanding
CAT has less shares outstanding than it did 5 years ago.
The debt/assets ratio for CAT has been reduced compared to a year ago.
2.2 Solvency
An Altman-Z score of 4.04 indicates that CAT is not in any danger for bankruptcy at the moment.
Looking at the Altman-Z score, with a value of 4.04, CAT is in the better half of the industry, outperforming 68.46% of the companies in the same industry.
The Debt to FCF ratio of CAT is 3.68, which is a good value as it means it would take CAT, 3.68 years of fcf income to pay off all of its debts.
The Debt to FCF ratio of CAT (3.68) is better than 63.08% of its industry peers.
CAT has a Debt/Equity ratio of 1.61. This is a high value indicating a heavy dependency on external financing.
With a Debt to Equity ratio value of 1.61, CAT is not doing good in the industry: 90.00% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.61 | ||
| Debt/FCF | 3.68 | ||
| Altman-Z | 4.04 |
ROIC/WACC2.42
WACC8.77%
2.3 Liquidity
CAT has a Current Ratio of 1.35. This is a normal value and indicates that CAT is financially healthy and should not expect problems in meeting its short term obligations.
CAT has a Current ratio of 1.35. This is in the lower half of the industry: CAT underperforms 78.46% of its industry peers.
CAT has a Quick Ratio of 1.35. This is a bad value and indicates that CAT is not financially healthy enough and could expect problems in meeting its short term obligations.
CAT has a worse Quick ratio (0.83) than 75.38% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.35 | ||
| Quick Ratio | 0.83 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an impressive 34.27% over the past year.
CAT shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 13.62% yearly.
Looking at the last year, CAT shows a quite strong growth in Revenue. The Revenue has grown by 8.59% in the last year.
Measured over the past years, CAT shows a small growth in Revenue. The Revenue has been growing by 4.15% on average per year.
EPS 1Y (TTM)34.27%
EPS 3Y51.58%
EPS 5Y13.62%
EPS growth Q2Q14.05%
Revenue 1Y (TTM)8.59%
Revenue growth 3Y17.11%
Revenue growth 5Y4.15%
Revenue growth Q2Q-0.4%
3.2 Future
Based on estimates for the next years, CAT will show a decrease in Earnings Per Share. The EPS will decrease by -4.92% on average per year.
Based on estimates for the next years, CAT will show a small growth in Revenue. The Revenue will grow by 3.72% on average per year.
EPS Next Y1.46%
EPS Next 2Y3.46%
EPS Next 3Y5.43%
EPS Next 5Y-4.92%
Revenue Next Year0.19%
Revenue Next 2Y1.55%
Revenue Next 3Y3.18%
Revenue Next 5Y3.72%
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
Based on the Price/Earnings ratio of 16.27, the valuation of CAT can be described as correct.
Based on the Price/Earnings ratio, CAT is valued a bit cheaper than the industry average as 74.62% of the companies are valued more expensively.
When comparing the Price/Earnings ratio of CAT to the average of the S&P500 Index (28.60), we can say CAT is valued slightly cheaper.
CAT is valuated correctly with a Price/Forward Earnings ratio of 15.69.
67.69% of the companies in the same industry are more expensive than CAT, based on the Price/Forward Earnings ratio.
When comparing the Price/Forward Earnings ratio of CAT to the average of the S&P500 Index (20.15), we can say CAT is valued slightly cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 16.27 | ||
| Fwd PE | 15.69 |
4.2 Price Multiples
63.08% of the companies in the same industry are more expensive than CAT, based on the Enterprise Value to EBITDA ratio.
CAT's Price/Free Cash Flow ratio is a bit cheaper when compared to the industry. CAT is cheaper than 75.38% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 16.94 | ||
| EV/EBITDA | 11.86 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates CAT does not grow enough to justify the current Price/Earnings ratio.
The excellent profitability rating of CAT may justify a higher PE ratio.
PEG (NY)11.18
PEG (5Y)1.19
EPS Next 2Y3.46%
EPS Next 3Y5.43%
5. Dividend
5.1 Amount
CAT has a Yearly Dividend Yield of 1.48%.
Compared to an average industry Dividend Yield of 1.66, CAT pays a bit more dividend than its industry peers.
Compared to the average S&P500 Dividend Yield of 2.32, CAT is paying slightly less dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.48% |
5.2 History
On average, the dividend of CAT grows each year by 8.72%, which is quite nice.
CAT has been paying a dividend for at least 10 years, so it has 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)8.72%
Div Incr Years10
Div Non Decr Years10
5.3 Sustainability
CAT pays out 23.04% of its income as dividend. This is a sustainable payout ratio.
DP23.04%
EPS Next 2Y3.46%
EPS Next 3Y5.43%
CATERPILLAR INC
NYSE:CAT (5/17/2024, 7:04:00 PM)
After market: 356.27 0 (0%)356.27
+5.55 (+1.58%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryMachinery
Earnings (Last)
Earnings (Next)
Inst Owners
Inst Owner Change
Ins Owners
Ins Owner Change
Market Cap174.23B
Analysts
Price Target
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.48% |
Dividend Growth(5Y)
DP
Div Incr Years
Div Non Decr Years
Ex-Date
Surprises & Revisions
EPS beat(2)
Avg EPS beat(2)
Min EPS beat(2)
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EPS beat(4)
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EPS beat(8)
Avg EPS beat(8)
EPS beat(12)
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EPS beat(16)
Avg EPS beat(16)
Revenue beat(2)
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Revenue beat(4)
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Revenue beat(16)
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PT rev (1m)
PT rev (3m)
EPS NQ rev (1m)
EPS NQ rev (3m)
EPS NY rev (1m)
EPS NY rev (3m)
Revenue NQ rev (1m)
Revenue NQ rev (3m)
Revenue NY rev (1m)
Revenue NY rev (3m)
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 16.27 | ||
| Fwd PE | 15.69 | ||
| P/S | |||
| P/FCF | |||
| P/OCF | |||
| P/B | |||
| P/tB | |||
| EV/EBITDA |
EPS(TTM)
EY
EPS(NY)
Fwd EY
FCF(TTM)
FCFY
OCF(TTM)
OCFY
SpS
BVpS
TBVpS
PEG (NY)11.18
PEG (5Y)1.19
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 13.43% | ||
| ROE | 63.77% | ||
| ROCE | |||
| ROIC | |||
| ROICexc | |||
| ROICexgc | |||
| OM | 22.43% | ||
| PM (TTM) | 16.79% | ||
| GM | 37.03% | ||
| FCFM |
ROA(3y)
ROA(5y)
ROE(3y)
ROE(5y)
ROIC(3y)
ROIC(5y)
ROICexc(3y)
ROICexc(5y)
ROICexgc(3y)
ROICexgc(5y)
ROCE(3y)
ROCE(5y)
ROICexcg growth 3Y
ROICexcg growth 5Y
ROICexc growth 3Y
ROICexc growth 5Y
OM growth 3Y
OM growth 5Y
PM growth 3Y
PM growth 5Y
GM growth 3Y
GM growth 5Y
F-Score
Asset Turnover0.8
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.61 | ||
| Debt/FCF | |||
| Debt/EBITDA | |||
| Cap/Depr | |||
| Cap/Sales | |||
| Interest Coverage | |||
| Cash Conversion | |||
| Profit Quality | |||
| Current Ratio | 1.35 | ||
| Quick Ratio | 0.83 | ||
| Altman-Z |
F-Score
WACC
ROIC/WACC
Cap/Depr(3y)
Cap/Depr(5y)
Cap/Sales(3y)
Cap/Sales(5y)
Profit Quality(3y)
Profit Quality(5y)
Growth
EPS 1Y (TTM)34.27%
EPS 3Y51.58%
EPS 5Y
EPS growth Q2Q
EPS Next Y1.46%
EPS Next 2Y
EPS Next 3Y
EPS Next 5Y
Revenue 1Y (TTM)8.59%
Revenue growth 3Y17.11%
Revenue growth 5Y
Revenue growth Q2Q
Revenue Next Year
Revenue Next 2Y
Revenue Next 3Y
Revenue Next 5Y
EBIT growth 1Y
EBIT growth 3Y
EBIT growth 5Y
EBIT Next Year
EBIT Next 3Y
EBIT Next 5Y
FCF growth 1Y
FCF growth 3Y
FCF growth 5Y
OCF growth 1Y
OCF growth 3Y
OCF growth 5Y