Caterpillar Inc. (CAT) AI Stock Analysis

Caterpillar Inc. manufactures and distributes construction and mining equipment, diesel and natural gas engines, and industrial gas turbines. The company operates through three primary segments: Construction Industries, Resource Industries, and Energy & Transportation. Construction Industries provides equipment such as asphalt pavers, compactors, loaders, and utility vehicles. Resource Industries offers heavy mining machinery including shovels, drills, loaders, and mining trucks. The Energy & Transportation segment supplies power generation solutions, marine engines, turbines, and related services. Caterpillar also delivers financial products, aftermarket parts distribution, and digital logistics solutions across its global customer base.

Caterpillar grew annual revenue from $50.97B in FY2021 to $67.59B in FY2025, reflecting a 5-year revenue CAGR of 10.1% from FY2020 to FY2025. Annual net income reached $10.79B in FY2024 before moving to $8.87B in FY2025, alongside an operating margin of 16.6% and diluted EPS of $19.08. Free cash flow stood at $7.45B in FY2025, compared to $8.82B in FY2024 and $9.79B in FY2023. Over the trailing twelve months, revenue reached $74.73B with a net profit margin of 14.5%. In the latest quarter ended June 30, 2026, quarterly revenue expanded 24.0% year-over-year, while quarterly earnings grew 68.2%.

As of June 30, 2026, Caterpillar held $6.71B in cash and short-term investments against total debt of $45.15B, resulting in net debt of $38.43B. The company reported a current ratio of 1.37 and a debt-to-equity ratio of 2.33, based on shareholders' equity of $19.39B and total assets of $102.61B. In FY2025, operating cash flow reached $11.74B. Capital expenditures totaled $4.29B, share buybacks were $5.21B, and dividends paid totaled $2.75B. Caterpillar also reduced its share count by 14.8% over five years.

At a last close of $730.76, Caterpillar trades at a trailing P/E of 31.5x and a forward P/E of 25.4x, compared to the median of its S&P 500 Industrials peers at 28.4x and 20.1x. Its EV-to-EBITDA multiple of 24.5x sits above the peer median of 17.2x, while its price-to-sales ratio of 4.5x compares to the peer median of 3.1x. Over the past year, CAT returned 36.3%, outpacing the S&P 500 (SPY) return of 16.8%. Over five years, the stock returned 300.2% versus 83.0% for the index.

Caterpillar pays a quarterly dividend with an annualized forward payout of $6.52 per share, representing a dividend yield of 0.89%. The payout ratio is 26.4%, supported by 45 consecutive years of dividend payments. Over the past five years, the dividend has grown at an annualized rate of 7.2%. The last ex-dividend date was October 26, 2026.

Wall Street analyst ratings stand at 14 Strong Buy, 1 Buy, 12 Hold, 0 Sell, and 1 Strong Sell. The mean price target of $951.11 represents 30.2% upside from the last close of $730.76. For the fiscal year ending December 31, 2026, analysts estimate EPS of $27.33 on revenue of $79.60B. For the next fiscal year, 27 analysts project EPS of $32.59 on revenue of $88.67B. Caterpillar beat EPS estimates in each of the last 4 quarters, with next earnings scheduled for October 29, 2026.

This page is an AI-written research summary of Caterpillar Inc. (CAT). The text was generated on October 30, 2026 from Quotelinks data as of October 16, 2026 (company profile, annual results, latest balance sheet, valuation, price performance and analyst estimates). An automatic check rejects any draft that contains a figure not found in that data. It is not investment advice; verify figures on the linked tabs before making decisions.

Related: CAT income statement, CAT balance sheet, CAT key metrics, CAT analyst forecast, CAT chart. See the CAT stock overview for the latest quote and news.