Caterpillar Inc. (CAT) Valuation

Valuation

Model-based estimates, not advice. The DCF is the discounted-cash-flow value per share; compare it with the price, not as a target.

DCF fair value

-71.2%

$179.75

vs $623.12 price

Levered DCF

$197.78

After debt service

Piotroski score

8 / 9

Strong

Altman Z-score

4.4

Safe zone

Rating

Overall 3 / 5

Ratios by fiscal year

Margins and yields are shares of revenue, equity or price; multiples are ×.

Metric	FY2025	FY2024	FY2023	FY2022	FY2021	FY2020	FY2019	FY2018
P/E	30.31×	16.36×	14.61×	18.82×	17.33×	33.03×	13.61×	12.23×
P/B	12.54×	9.06×	7.74×	7.95×	6.82×	6.46×	5.69×	5.35×
P/S	3.95×	2.72×	2.25×	2.12×	2.21×	2.37×	1.54×	1.37×
EV / EBITDA	20.24×	12.97×	11.58×	13.69×	12.77×	18.28×	10.39×	9.44×
Gross margin	32.3%	36.0%	34.7%	29.5%	29.4%	28.9%	30.5%	31.1%
Operating margin	16.6%	20.2%	19.3%	13.3%	13.5%	10.9%	15.4%	15.2%
Net margin	13.1%	16.7%	15.4%	11.3%	12.7%	7.2%	11.3%	11.2%
Current ratio	1.44×	1.42×	1.35×	1.39×	1.46×	1.53×	1.47×	1.37×
Debt / equity	2.03×	1.97×	1.94×	2.33×	2.29×	2.42×	2.58×	2.6×
Interest coverage	10.88×	25.53×	25.37×	17.84×	14.18×	8.93×	19.88×	20.68×
Dividend yield	1.0%	1.5%	1.7%	1.9%	2.1%	2.3%	2.6%	2.6%
Payout ratio	31.0%	24.5%	24.8%	36.4%	35.9%	74.8%	35.0%	31.7%

Key metrics by fiscal year

Metric	FY2025	FY2024	FY2023	FY2022	FY2021	FY2020	FY2019	FY2018
Return on equity	41.6%	55.4%	53.0%	42.3%	39.4%	19.6%	41.8%	43.8%
Return on invested capital	11.4%	15.8%	15.4%	9.8%	8.4%	5.3%	10.2%	10.5%
Return on assets	9.0%	12.3%	11.8%	8.2%	7.8%	3.8%	7.8%	7.8%
Free cash flow yield	2.8%	5.0%	6.5%	4.1%	4.2%	4.3%	5.1%	4.8%
Earnings yield	3.3%	6.1%	6.8%	5.3%	5.8%	3.0%	7.3%	8.2%
Enterprise value	$300.6B	$208.1B	$181.9B	$156.2B	$141B	$126.8B	$112.3B	$103.8B
Net debt / EBITDA	2.25×	1.97×	1.97×	2.63×	2.58×	4.01×	2.72×	2.61×
Cash conversion cycle (days)	190	187	175	176	184	212	173	160