CATERPILLAR INC (CAT) Stock Analysis

Analysis from 10-Q filed 2025-11-03. Data as of Q1 2026.

Overall Grade: F (Concerning)

Grade F (Concerning). ROIC 26.6%. FCF margin 13.4%. D/E 0.3x. Source: 10-Q filed 2025-11-03.

Metric	Value	Context
ROIC	26.6%	Above industry average
FCF Margin	13.4%	Healthy cash flow
Debt/Equity	0.3x	Conservative leverage

ROIC 26.6% — Top 5% of sector peers. FCF margin 13.4% — Top 25%.

Explore CATERPILLAR INC: Earnings History | Filings | ROIC Analysis

Programmatic access: Available via MCP at mcp.metricduck.com. Tools for CAT: get_company_overview, get_filing_index (lens: debt_stress, management_outlook, risk_trajectory), get_filing_changes, get_metric_history, compare_companies, screen_filing_signals.

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Profitability: CATERPILLAR INC earns 26.6% ROIC, Top 5% in Industrials

ROIC TTM 26.6%, sector median 7.3%, Top 5%. DuPont: NOPAT margin 12.6% × asset turnover 0.8x. Gross margin 33.4%. Operating margin 16.5%. Source: 10-Q filed 2025-11-03.

Metric	CAT	Rating	Context
Return on Invested Capital (ROIC)	26.6%	Excellent	Above sector median of 7.3%
Return on Equity (ROE)	47.7%	Excellent	Efficient use of shareholder equity
Gross Margin	33.4%	Good	Competitive pricing environment
Operating Margin	16.5%	Good	Efficient operations

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Cash Flow: CATERPILLAR INC generates $9.5B FCF at 13.4% margin, positive NaN/8 quarters

FCF TTM $9.5B. FCF margin 13.4%, Top 25%. OCF/Net income 1.3x. Positive FCF in NaN/8 trailing quarters. Source: 10-Q filed 2025-11-03.

Metric	CAT	Rating	Context
Free Cash Flow Margin	13.4%	Good	Healthy cash generation
Free Cash Flow (TTM)	$9.5B	Good	Positive cash generation
OCF/Net Income	1.3x	Excellent	High earnings quality
FCF Consistency (8Q)	N/A	Warning	Variable cash flow

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Balance Sheet: CATERPILLAR INC at 0.3x leverage

Debt/Equity 0.3x. Total debt $4.7B, cash & investments $4.1B. Source: 10-Q filed 2025-11-03.

Metric	CAT	Rating	Context
Debt to Equity	0.3x	Excellent	Conservative capital structure
Net Cash Position	$-653.0M	Adequate	Net debt position

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Valuation: CATERPILLAR INC trades at 35.1x earnings

P/E 35.1x. EV/Sales 4.8x. FCF yield 2.9%. Dividend yield 0.8%. Source: 10-Q filed 2025-11-03.

Metric	CAT	Rating	Context
P/E Ratio	35.1x	Adequate	Premium valuation
EV/Sales	4.8x	Good	Growth premium priced in
FCF Yield	2.9%	Adequate	Lower cash yield
Dividend Yield	0.8%	Adequate	Growth focus over income

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Capital Allocation: CATERPILLAR INC returns 2.8% shareholder yield

Total shareholder yield 2.8% (div 0.8% + buyback 2.0%). Capital returned $9.3B TTM. Source: 10-Q filed 2025-11-03.

Metric	CAT	Rating	Context
Total Shareholder Yield	2.8%	Adequate	Dividend + buyback yield combined
Buyback Yield	2.0%	Adequate	Minimal buyback activity
Total Capital Returned (TTM)	$9.3B	Good	Dividends + buybacks returned to shareholders

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Sector Rankings

Metric	Value	Percentile	vs Median
Return on Invested Capital (ROIC)	26.6%	Top 5%	3.7x above
Free Cash Flow Margin	13.4%	Top 25%	2.8x above
Gross Margin	33.4%	Top 50%	1.0x above
Operating Margin	16.5%	Top 25%	2.3x above
Return on Equity (ROE)	47.7%	Top 5%	5.5x above
P/E Ratio	35.1x	N/A	-

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Financial Scorecard

Metric	CAT	Rating	Sector Context
Return on Invested Capital (ROIC)	26.6%	Excellent	Top 5% of sector (median: 7.3%)
Free Cash Flow Margin	13.4%	Good	Top 25% of sector (median: 4.8%)
Gross Margin	33.4%	Good	Top 50% of sector (median: 33.1%)
Debt to Equity Ratio	25.3%	Excellent	Conservative capital structure
P/E Ratio (Price-to-Earnings)	35.1x	Adequate	High expectations priced in
Free Cash Flow Yield	2.9%	Warning	Growth-focused valuation

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Frequently Asked Questions

Q: What is CATERPILLAR INC's Return on Invested Capital (ROIC)?

CATERPILLAR INC (CAT) has a trailing twelve-month Return on Invested Capital (ROIC) of 26.6%. Sector median 7.3%. Source: 10-Q filed 2025-11-03.

Q: What is CATERPILLAR INC's Free Cash Flow Margin?

CATERPILLAR INC (CAT) has a free cash flow margin of 13.4%, generating $9.5 billion in free cash flow over the trailing twelve months. Source: 10-Q filed 2025-11-03.

Q: What is CATERPILLAR INC's P/E ratio and how does it compare to peers?

CATERPILLAR INC (CAT) trades at a P/E ratio of 35.1x, which is above the sector median of N/A. EV/Sales 4.8x. FCF yield 2.9%. Source: 10-Q filed 2025-11-03.

Q: Does CATERPILLAR INC pay a dividend?

CATERPILLAR INC (CAT) currently pays a dividend yield of 0.8%. Total shareholder yield (dividend + buybacks) 2.8%. Source: 10-Q filed 2025-11-03.

Q: What is CATERPILLAR INC's revenue and earnings growth?

CATERPILLAR INC (CAT) grew revenue by 11.8% year-over-year. EPS -2.2% YoY. Source: 10-Q filed 2025-11-03.

Q: Is CATERPILLAR INC buying back stock?

CATERPILLAR INC (CAT) repurchased $6.6 billion of stock over the trailing twelve months. This represents a buyback yield of 2.0%. Source: 10-Q filed 2025-11-03.

Q: How does CATERPILLAR INC compare to competitors in Industrials?

Compared to other companies in Industrials, CATERPILLAR INC (CAT) shows: ROIC 26.6%, sector median 7.3% (Top 5%). FCF margin 13.4%, sector median 4.8% (Top 25%). Gross margin 33.4%, 0.4pp above sector median. These rankings are based on MetricDuck's analysis of all Industrials companies with available SEC filings.

Q: What warning signs should I watch for with CATERPILLAR INC?

Quantitative warning flags for CATERPILLAR INC (CAT): 1) ROIC declining -12.6% over 8 quarters. Source: 10-Q filed 2025-11-03.

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Data Source: Data sourced from 10-Q filed 2025-11-03. TTM metrics as of Q1 2026.

Methodology: Financial metrics calculated from SEC 10-K and 10-Q filings using standardized formulas. Sector comparisons use peer group based on SIC code.

Scope: This analysis covers SEC filing fundamentals — profitability, cash flow, balance sheet, and valuation metrics. For analyst estimates and price targets, consult sell-side research.

This analysis is for informational purposes only and does not constitute investment advice.