Caterpillar Inc. (CAT) Stock Analysis — Fair Value, Risk & Moat Rating
NYQ · Industrials · Farm & Heavy Construction Machinery
Is Caterpillar Inc. a safe investment right now?
Caterpillar Inc.'s Altman Z-Score of 5.15 places it in the safe zone. Our fair value estimate is $747.52 (Fairly Valued). Moat rating: 3.7/5 stars.
Could Caterpillar Inc. go bankrupt? Altman Z-Score analysis
Z-Score of 5.15 is above 3.0, indicating the company is financially healthy by this metric.
- Below 1.8 — Distress Zone (high bankruptcy risk)
- 1.8 to 3.0 — Gray Zone (elevated uncertainty)
- Above 3.0 — Safe Zone (financially healthy)
What drives CAT's Z-Score?
| Component | Formula | Value | Weight | Contribution |
|---|---|---|---|---|
| A · Working Capital / Total Assets | WC / TA | 0.1616 | 1.2 | 0.19 |
| B · Retained Earnings / Total Assets | RE / TA | 0.6639 | 1.4 | 0.93 |
| C · EBIT / Total Assets | EBIT / TA | 0.1222 | 3.3 | 0.4 |
| D · Market Cap / Total Liabilities | MCap / TL | 4.899 | 0.6 | 2.94 |
| E · Revenue / Total Assets | Rev / TA | 0.6856 | 1.0 | 0.69 |
How has CAT's financial health changed over time?
| Year | Z-Score | Zone |
|---|---|---|
| 2022 | 5.46 | Safe |
| 2023 | 5.61 | Safe |
| 2024 | 5.72 | Safe |
| 2025 | 5.15 | Safe |
Source: Calculated from CAT's latest 10-K filing on SEC EDGAR.
What is Caterpillar Inc. actually worth?
How we calculated this
| Input | Value | Source |
|---|---|---|
| Predicted EPS (α) | $20.48 | Proprietary blend of reported actuals + analyst consensus, weighted by α |
| Last Year EPS | $18.81 | Annual report (SEC EDGAR) |
| Analyst Consensus EPS (This Year) | $22.99 | 26 analysts consensus |
| Trailing P/E | 42.9x | Current market pricing |
| Fair P/E (β discount) | 36.5x | Trailing PE adjusted by value discount factor β, hard-capped |
| Earnings Trend (γ) | Growing | Directional signal: predicted vs trailing EPS |
Wall Street Reference: Analyst consensus target price is $759.48 (26 analysts). This is shown for reference only and is not used in our valuation model.
Source: Earnings data from SEC EDGAR filings. Market data via Yahoo Finance.
Does Caterpillar Inc. have a durable competitive advantage?
Moat rating: 3.7/5.
What makes up CAT's moat score?
ROIC Stability
ROIC variability over the past decade. Score: 4/5.
Gross Margin Trend
Gross margin trajectory over the past decade. Score: 4/5.
Switching Costs
Estimated customer lock-in based on margin level. Score: 3/5.
How stable is CAT's return on invested capital?
| Year | ROIC | Trend |
|---|---|---|
| 2022 | 17.4% | — |
| 2023 | 23.6% | Rising |
| 2024 | 23.9% | Stable |
| 2025 | 18.6% | Declining |
Source: ROIC calculated from SEC EDGAR filings.
Is Caterpillar Inc.'s dividend safe?
Can Caterpillar Inc. afford its dividend?
Payout ratio is 31.1%. FCF covers the dividend 2.1x. 53 consecutive years of payments.
Caterpillar Inc.'s key financial metrics
| Metric | Latest | 1Y Ago | 3Y Ago | Trend |
|---|---|---|---|---|
| Revenue | $67.6B | $64.8B | $59.4B | Rising |
| Net Income | $8.9B | $10.8B | $6.7B | Rising |
| Free Cash Flow | $7.5B | $8.8B | $5.2B | Rising |
| Gross Margin | 31.8% | 36.0% | 29.5% | Rising |
Recent events that affect our CAT analysis
CAT earnings report scheduled
Upcoming report. Consensus EPS estimate: $4.64. Revenue estimate: $16.42B. Our current Fair Value: $747.52 — a significant beat or miss could shift this estimate.
CAT analyst consensus: 54% bullish (15 of 28 analysts)
1 Strong Buy, 14 Buy, 11 Hold, 2 Sell, 0 Strong Sell. Consensus target: $759.48 (6.1% downside). Compare with our independent Fair Value: $747.52.
CAT paid $1.5100/share dividend
Dividend Safety Grade: A. Payout ratio: 31.1%.
CAT filed 8-K (material event)
8-K filings disclose material events — acquisitions, leadership changes, or guidance revisions that may affect valuation. View on SEC EDGAR →
CAT filed 8-K (material event)
8-K filings disclose material events — acquisitions, leadership changes, or guidance revisions that may affect valuation. View on SEC EDGAR →
CAT filed 8-K (material event)
8-K filings disclose material events — acquisitions, leadership changes, or guidance revisions that may affect valuation. View on SEC EDGAR →
CAT filed annual report (10-K)
Annual filing with full-year financials. Our Altman Z-Score, Moat, and Fair Value models are derived from this data. View on SEC EDGAR →
CAT beat EPS estimates by 9.5%
Reported EPS: $5.16 vs estimate $4.71. Earnings strength supports our Fair Value of $747.52 (7.6% below current price).
CAT filed 8-K (material event)
8-K filings disclose material events — acquisitions, leadership changes, or guidance revisions that may affect valuation. View on SEC EDGAR →
CAT paid $1.5100/share dividend
Dividend Safety Grade: A. Payout ratio: 31.1%.
CAT filed 8-K (material event)
8-K filings disclose material events — acquisitions, leadership changes, or guidance revisions that may affect valuation. View on SEC EDGAR →
CAT filed quarterly report (10-Q)
Quarterly update with interim financials. May signal changes to earnings trajectory and balance sheet health. View on SEC EDGAR →
CAT beat EPS estimates by 9.4%
Reported EPS: $4.95 vs estimate $4.52. Earnings strength supports our Fair Value of $747.52 (7.6% below current price).
CAT filed 8-K (material event)
8-K filings disclose material events — acquisitions, leadership changes, or guidance revisions that may affect valuation. View on SEC EDGAR →
CAT paid $1.5100/share dividend
Dividend Safety Grade: A. Payout ratio: 31.1%.
CAT filed 8-K (material event)
8-K filings disclose material events — acquisitions, leadership changes, or guidance revisions that may affect valuation. View on SEC EDGAR →
CAT filed 8-K (material event)
8-K filings disclose material events — acquisitions, leadership changes, or guidance revisions that may affect valuation. View on SEC EDGAR →
CAT filed quarterly report (10-Q)
Quarterly update with interim financials. May signal changes to earnings trajectory and balance sheet health. View on SEC EDGAR →
CAT missed EPS estimates by 3.5%
Reported EPS: $4.62 vs estimate $4.79. Our Fair Value of $747.52 may face downward pressure if the trend continues.
CAT filed 8-K (material event)
8-K filings disclose material events — acquisitions, leadership changes, or guidance revisions that may affect valuation. View on SEC EDGAR →
CAT paid $1.5100/share dividend
Dividend Safety Grade: A. Payout ratio: 31.1%.
CAT filed 8-K (material event)
8-K filings disclose material events — acquisitions, leadership changes, or guidance revisions that may affect valuation. View on SEC EDGAR →
CAT filed 8-K (material event)
8-K filings disclose material events — acquisitions, leadership changes, or guidance revisions that may affect valuation. View on SEC EDGAR →
CAT filed quarterly report (10-Q)
Quarterly update with interim financials. May signal changes to earnings trajectory and balance sheet health. View on SEC EDGAR →
CAT missed EPS estimates by 2.2%
Reported EPS: $4.25 vs estimate $4.34. Our Fair Value of $747.52 may face downward pressure if the trend continues.
CAT filed 8-K (material event)
8-K filings disclose material events — acquisitions, leadership changes, or guidance revisions that may affect valuation. View on SEC EDGAR →
CAT paid $1.4100/share dividend
Dividend Safety Grade: A. Payout ratio: 31.1%.
CAT filed 8-K (material event)
8-K filings disclose material events — acquisitions, leadership changes, or guidance revisions that may affect valuation. View on SEC EDGAR →
CAT filed 8-K (material event)
8-K filings disclose material events — acquisitions, leadership changes, or guidance revisions that may affect valuation. View on SEC EDGAR →
CAT filed annual report (10-K)
Annual filing with full-year financials. Our Altman Z-Score, Moat, and Fair Value models are derived from this data. View on SEC EDGAR →
CAT beat EPS estimates by 2.2%
Reported EPS: $5.14 vs estimate $5.03. Earnings strength supports our Fair Value of $747.52 (7.6% below current price).
CAT filed 8-K (material event)
8-K filings disclose material events — acquisitions, leadership changes, or guidance revisions that may affect valuation. View on SEC EDGAR →
CAT paid $1.4100/share dividend
Dividend Safety Grade: A. Payout ratio: 31.1%.
Common questions about Caterpillar Inc.
What is Caterpillar Inc. stock price today?
Caterpillar Inc. (CAT) stock price is $808.87 as of the latest market close, traded on the NYSE exchange.
What does Caterpillar Inc. do?
Caterpillar Inc. provides construction and mining equipment, off-highway diesel and natural gas engines, industrial gas turbines, and diesel-electric locomotives in the United States and internationally. The Construction Industries segment offers asphalt pavers, cold planers, compactors, forestry machines, material handlers, motor graders, pipelayers, road reclaimers, telehandlers, track-type tractors, and track and wheel excavators; backhoe, compact track, skid steer, track-type, and wheel loaders; and related parts and work tools.
What is Caterpillar Inc. market cap?
Caterpillar Inc. has a market capitalization of $378.53B, classifying it as a mega-cap stock in the Industrials sector.
What sector and industry is CAT in?
Caterpillar Inc. operates in the Industrials sector, specifically within the Farm & Heavy Construction Machinery industry. It trades on the NYSE under the ticker symbol CAT.
Is CAT stock overvalued or undervalued?
Based on our valuation model, Caterpillar Inc. trades 8.2% above our fair value estimate — potentially overvalued.
- FairValueLabs Fair Value: $747.52
- Current Price: $808.87
- Valuation Zone: Fairly Valued
What is CAT stock forecast and analyst target price?
Based on 26 Wall Street analysts, the consensus price target for Caterpillar Inc. is $759.48, implying downside of 6.1% from the current price.
- Analyst High Target: $920.00
- Analyst Low Target: $430.00
Note: Analyst targets are shown for reference and are not used in our valuation model.
Is Caterpillar Inc. revenue and earnings growing?
Here are the analyst consensus growth estimates for Caterpillar Inc.:
- Revenue growth (current year est.): 9.1%
- EPS growth (current year est.): 20.6%
- Revenue growth (next year est.): 9.0%
- EPS growth (next year est.): 21.4%
What are Caterpillar Inc.'s key financial metrics?
| Metric | Latest | Trend |
|---|---|---|
| Revenue | $67.6B | Rising |
| Net Income | $8.9B | Rising |
| Free Cash Flow | $7.5B | Rising |
| Gross Margin | 31.8% | Rising |
What is CAT's P/E ratio?
The price-to-earnings ratio measures how much investors pay per dollar of earnings:
- Trailing P/E (last 12 months): 42.9x
- Forward P/E (next 12 months est.): 29.0x
- FairValueLabs Fair P/E: 36.5x
How volatile is CAT stock?
Caterpillar Inc. has a beta of 1.52, meaning it is significantly more volatile than the broader market. A beta above 1.0 indicates higher price swings relative to the S&P 500, while below 1.0 suggests more stability.
How much cash and debt does Caterpillar Inc. have?
Caterpillar Inc.'s balance sheet shows:
- Total Cash: $9.33B
- Total Debt: $44.06B
- Net Cash Position: $-34.73B
A positive net cash position means the company holds more cash than debt, reducing financial risk.
What is Caterpillar Inc.'s free cash flow?
Caterpillar Inc. generated $5.84B in trailing twelve-month free cash flow (from $11.74B in operating cash flow). Free cash flow represents the cash available for dividends, buybacks, and debt reduction after all capital expenditures.
Does Caterpillar Inc. pay a dividend, and is it safe?
Yes, Caterpillar Inc. pays a regular dividend. Here are the key metrics:
- Dividend Yield: 0.7%
- Payout Ratio: 31.1%
- Consecutive Years Paid: 53
- 5-Year Dividend Growth: -6.7%
- FairValueLabs Safety Grade: A
Is Caterpillar Inc. at risk of going bankrupt?
Caterpillar Inc.'s Altman Z-Score is 5.15, placing it in the safe zone (above 3.0) — bankruptcy risk is low. The Z-Score uses five balance sheet ratios to predict bankruptcy probability within two years.
Does Caterpillar Inc. have a durable competitive advantage?
Caterpillar Inc. scores 3.7/5 stars (Solid moat · eroding) in our moat analysis:
- ROIC Stability: 4/5
- Gross Margin Trend: 4/5
- Switching Costs: 3/5
A score above 3.5 suggests meaningful pricing power and a defensible market position.
What is CAT's return on equity (ROE)?
Caterpillar Inc.'s return on equity is 43.5%. ROE measures how efficiently a company generates profits from shareholder equity. An ROE above 15% is generally considered strong, while below 10% may signal inefficiency.
How do I buy CAT stock?
CAT shares can be purchased through any brokerage account that provides access to the NYSE. Common steps:
- Open an account with a broker (e.g., Fidelity, Schwab, Interactive Brokers)
- Search for ticker symbol CAT
- Place a market or limit order for your desired number of shares
This is not investment advice. Always do your own research before buying any stock.
Is CAT a value stock or speculative?
FairValueLabs classifies Caterpillar Inc. as Value-Speculation. It has some value characteristics but carries elevated risk factors that make it speculative. Extra due diligence is recommended.
Who is the CEO of Caterpillar Inc.?
The current CEO of Caterpillar Inc. is Mr. Joseph E. Creed CPA.
What is CAT's earnings per share (EPS)?
Earnings per share measures the company's profit allocated to each outstanding share:
- Trailing EPS (last 12 months): $18.85
- Forward EPS (next 12 months est.): $27.90
- Analyst consensus EPS (this year): $22.99
- Analyst consensus EPS (next year): $27.90
Other Industrials companies analyzed by FairValueLabs
FairValueLabs Disclaimer
All valuations, scores, ratings, and classifications on this page are produced by the FairValueLabs internal valuation system. They do not represent actual market value, guaranteed outcomes, or professional investment advice. These are analytical estimates for educational and research purposes only.
This is not financial advice. All data is sourced from SEC EDGAR public filings. Always consult a qualified financial advisor before making investment decisions.
Last updated: Apr 22, 2026. Data sources: SEC EDGAR (financial statements), Yahoo Finance (market data, analyst consensus). Data may not reflect the most recent quarter.
CAT analysis methodology: How we calculate fair value, Z-Scores, and moat ratings