CATERPILLAR INC (CAT) Stock Analysis

Analysis from 10-Q filed 2025-11-03. Data as of Q2 2026.

Overall Grade: F (Concerning)

Grade F (Concerning). ROIC 16.9%. FCF margin 14.3%. D/E 2.1x. Source: 10-Q filed 2025-11-03.

Metric	Value	Context
ROIC	16.9%	Solid returns
FCF Margin	14.3%	Healthy cash flow
Debt/Equity	2.1x	Elevated debt

ROIC 16.9% — Top 25% of sector peers. FCF margin 14.3% — Top 25%.

Explore CATERPILLAR INC: Earnings History | Filings

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 16.9% ROIC, Top 25% in Industrials

ROIC TTM 16.9%, sector median 7.3%, Top 25%. DuPont: NOPAT margin 13.4% × asset turnover 0.8x. Gross margin 34.3%. Operating margin 17.5%. Source: 10-Q filed 2025-11-03.

Metric	CAT	Rating	Context
Return on Invested Capital (ROIC)	16.9%	Good	Above sector median of 7.3%
Return on Equity (ROE)	54.4%	Excellent	Efficient use of shareholder equity
Gross Margin	34.3%	Good	Competitive pricing environment
Operating Margin	17.5%	Good	Efficient operations

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Cash Flow: CATERPILLAR INC generates $10.7B FCF at 14.3% margin, positive NaN/8 quarters

FCF TTM $10.7B. FCF margin 14.3%, 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	14.3%	Good	Healthy cash generation
Free Cash Flow (TTM)	$10.7B	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 2.1x leverage

Debt/Equity 2.1x. Total debt $40.1B, cash & investments $6.7B. Source: 10-Q filed 2025-11-03.

Metric	CAT	Rating	Context
Debt to Equity	2.1x	Warning	Elevated leverage
Net Cash Position	$-33.4B	Warning	Net debt position

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Valuation: CATERPILLAR INC trades at 45.6x earnings

P/E 45.6x. EV/Sales 4.3x. FCF yield 2.2%. Dividend yield 0.6%. Source: 10-Q filed 2025-11-03.

Metric	CAT	Rating	Context
P/E Ratio	45.6x	Adequate	Premium valuation
EV/Sales	4.3x	Good	Growth premium priced in
FCF Yield	2.2%	Adequate	Lower cash yield
Dividend Yield	0.6%	Adequate	Growth focus over income

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Capital Allocation: CATERPILLAR INC returns 1.9% shareholder yield

Total shareholder yield 1.9% (div 0.6% + buyback 1.4%). Capital returned $9.5B TTM. Source: 10-Q filed 2025-11-03.

Metric	CAT	Rating	Context
Total Shareholder Yield	1.9%	Adequate	Dividend + buyback yield combined
Buyback Yield	1.4%	Adequate	Minimal buyback activity
Total Capital Returned (TTM)	$9.5B	Good	Dividends + buybacks returned to shareholders

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Sector Rankings

Metric	Value	Percentile	vs Median
Return on Invested Capital (ROIC)	16.9%	Top 25%	2.3x above
Free Cash Flow Margin	14.3%	Top 25%	3.0x above
Gross Margin	34.3%	Top 50%	1.1x above
Operating Margin	17.5%	Top 25%	2.3x above
Return on Equity (ROE)	54.4%	Top 5%	5.6x above
P/E Ratio	45.6x	N/A	-

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Financial Scorecard

Metric	CAT	Rating	Sector Context
Return on Invested Capital (ROIC)	16.9%	Good	Top 25% of sector (median: 7.3%)
Free Cash Flow Margin	14.3%	Good	Top 25% of sector (median: 4.7%)
Gross Margin	34.3%	Good	Top 50% of sector (median: 32.3%)
Debt to Equity Ratio	206.8%	Warning	High financial leverage
P/E Ratio (Price-to-Earnings)	45.6x	Adequate	High expectations priced in
Free Cash Flow Yield	2.2%	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 16.9%. 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 14.3%, generating $10.7 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 45.6x, which is above the sector median of N/A. EV/Sales 4.3x. FCF yield 2.2%. Source: 10-Q filed 2025-11-03.

Q: Does CATERPILLAR INC pay a dividend?

CATERPILLAR INC (CAT) currently pays a dividend yield of 0.6%. Total shareholder yield (dividend + buybacks) 1.9%. Source: 10-Q filed 2025-11-03.

Q: How much debt does CATERPILLAR INC have?

CATERPILLAR INC (CAT) has a debt-to-equity ratio of 2.1x with total debt of $40.1 billion. Net debt $33.4 billion. Source: 10-Q filed 2025-11-03.

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

CATERPILLAR INC (CAT) grew revenue by 18.4% year-over-year. EPS +18.0% YoY. Source: 10-Q filed 2025-11-03.

Q: Is CATERPILLAR INC buying back stock?

CATERPILLAR INC (CAT) repurchased $6.7 billion of stock over the trailing twelve months. This represents a buyback yield of 1.4%. 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 16.9%, sector median 7.3% (Top 25%). FCF margin 14.3%, sector median 4.7% (Top 25%). Gross margin 34.3%, 2.1pp 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) debt/equity 2.1x (above 1.5x threshold). 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 Q2 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.