Caterpillar delivered 17% revenue growth to $20.7 billion, 38% growth in adjusted operating profit to $4.3 billion, and 45% adjusted EPS growth to $7.20. Despite this, and despite 96% growth in its order backlog to $78 billion, shares continued their sharp decline in Oct. 29 trading.
Management may be understating the group’s margin potential of 18%-22% as further services growth is likely to be margin accretive. There is a spread between the core construction segment and the others that could narrow.
Due to Caterpillar’s cyclicality, management profit margin targets may not be maintainable through the business cycle. Worse decremental margins would imply the value proposition to customers isn’t as robust.
|
Metric
|
CAT
|
6301
|
|---|---|---|
Price/Earnings (Normalized) | 26.14 | 14.94 |
Price/Book Value | 13.33 | 1.59 |
Price/Sales | 3.72 | 1.36 |
Price/Cash Flow | 18.78 | 9.24 |
|
Metric
|
CAT
|
6301
|
|---|---|---|
Quick Ratio | 0.77 | 1.06 |
Current Ratio | 1.37 | 2.11 |
Interest Coverage | 27.32 | 10.61 |
|
Metric
|
CAT
|
6301
|
|---|---|---|
Return on Assets (Normalized) | 11.55% | 6.68% |
Return on Equity (Normalized) | 56.29% | 12.35% |
Return on Invested Capital (Normalized) | 18.42% | 8.78% |
|
1-Day Chart
|
Name
|
Price
|
Morningstar Rating for Stocks
|
Capital Allocation
|
Economic Moat
|
Market Cap
|
|---|---|---|---|---|---|---|
| Deere & Co
DE
| LOCK|y^sY#j$ | LOCK|<dK | $182B | |||
| Volvo AB Class A
VOLAF
| — | LOCK|#C!&R | $64B | |||
| Volvo AB Class B
VOLVF
| — | LOCK|!$#J | $64B | |||
| Volvo AB ADR
VLVLY
| — | LOCK|Ps?d | $64B | |||
| PACCAR Inc
PCAR
| LOCK|n>^Zh% | LOCK|h$hh | $54B | |||
| CNH Industrial NV
CNH
| LOCK|HWnd<b | LOCK|#WxZ | $19B | |||
| Oshkosh Corp
OSK
| LOCK|w%QFw#g | LOCK|?><J | $9B | |||
| AGCO Corp
AGCO
| LOCK|&xLCqF! | LOCK|mZQ | $8B | |||
| Terex Corp
TEX
| LOCK|&r%vKs | LOCK|SH?J | $6B |
United States