Caterpillar Profit Margin

CAT
 Stock
  

USD 236.41  1.29  0.55%   

Caterpillar fundamentals help investors to digest information that contributes to Caterpillar's financial success or failures. It also enables traders to predict the movement of Caterpillar Stock. The fundamental analysis module provides a way to measure Caterpillar's intrinsic value by examining its available economic and financial indicators, including the cash flow records, the balance sheet account changes, the income statement patterns, and various microeconomic indicators and financial ratios related to Caterpillar stock.
This module does not cover all equities due to inconsistencies in global equity categorizations. Continue to Equity Screeners to view more equity screening tools.
  
Profit Margin is likely to gain to 13.74 in 2022.

Caterpillar Profit Margin Analysis

Caterpillar's Profit Margin measures overall efficiency of a company and shows its ability to withstand competition as well as defend against adverse conditions such as rising costs, falling prices, decline in sales or management distress. Profit margin tells investors how well the company executes on its overall pricing strategies as well as how effective the company in controlling its costs.

Caterpillar Profit Margin

13.74

Profit Margin 
 = 
Net Income 
Revenue 
X
100 
More About Profit Margin | All Equity Analysis

Current Caterpillar Profit Margin

    
  13.02 %  
Most of Caterpillar's fundamental indicators, such as Profit Margin, are part of a valuation analysis module that helps investors searching for stocks that are currently trading at higher or lower prices than their real value. If the real value is higher than the market price, Caterpillar is considered to be undervalued, and we provide a buy recommendation. Otherwise, we render a sell signal.

Caterpillar Profit Margin Driver Correlations

Understanding the fundamental principles of building solid financial models for Caterpillar is extremely important. It helps to project a fair market value of Ford stock properly, considering its historical fundamentals such as Profit Margin. Since Caterpillar's main accounts across its financial reports are all linked and dependent on each other, it is essential to analyze all possible correlations between related accounts. However, instead of reviewing all of Caterpillar's historical financial statements, investors can examine the correlated drivers to determine its overall health. This can be effectively done using a conventional correlation matrix of Caterpillar's interrelated accounts and indicators.

Caterpillar Profit Margin Historical Pattern

Today, most investors in Caterpillar Stock are looking for potential investment opportunities by analyzing not only static indicators but also various Caterpillar's growth ratios. Consistent increases or drops in fundamental ratios usually indicate a possible pattern that can be successfully translated into profits. However, when comparing two companies, knowing each company's profit margin growth rates may not be enough to decide which company is a better investment. That's why investors frequently use a static breakdown of Caterpillar profit margin as a starting point in their analysis.
   Caterpillar Profit Margin   
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In a nutshell, Profit Margin indicator shows the amount of money the company makes from total sales or revenue. It can provide a good insight into companies in the same sector, as well as help to identify trends of a company from year to year.
Compare to competition

Caterpillar Operating Margin

Operating Margin

12.6

Caterpillar Operating Margin is comparatively stable at the moment as compared to the past year. Caterpillar reported Operating Margin of 14.39 in 2021
Based on the latest financial disclosure, Caterpillar has a Profit Margin of 13.02%. This is much higher than that of the Industrials sector and significantly higher than that of the Farm & Heavy Construction Machinery industry. The profit margin for all United States stocks is notably lower than that of the firm.

Caterpillar Profit Margin Peer Comparison

Stock peer comparison is one of the most widely used and accepted methods of equity analyses. It analyses Caterpillar's direct or indirect competition against its Profit Margin to detect undervalued stocks with similar characteristics or determine the stocks which would be a good addition to a portfolio. Peer analysis of Caterpillar could also be used in its relative valuation, which is a method of valuing Caterpillar by comparing valuation metrics of similar companies.
Caterpillar is currently under evaluation in profit margin category among related companies.

Caterpillar Current Valuation Drivers

We derive many important indicators used in calculating different scores of Caterpillar from analyzing Caterpillar's financial statements. These drivers represent accounts that assess Caterpillar's ability to generate profits relative to its revenue, operating costs, and shareholders' equity. Below are some of Caterpillar's important valuation drivers and their relationship over time.
201720182019202020212022 (projected)
Net Income Per Employee7.66 K59.11 K59.56 K30.73 K60.25 K65.01 K
Revenue Per Employee462.01 K526.17 K525.9 K427.89 K473.27 K446.13 K
Average Assets77.9 B78.43 B78.59 B76.88 B81.5 B76.81 B
Earnings Before Interest Taxes and Depreciation Amortization EBITDA7.81 B11.38 B11.24 B7.22 B11.2 B9.64 B
Earnings Before Interest Taxes and Depreciation Amortization USD7.5 B11.02 B10.84 B6.95 B11.07 B10.8 B
Earnings before Tax4.09 B7.84 B7.84 B4 B8.23 B7.42 B
Average Equity14.3 B15.05 B14.99 B14.6 B16.68 B15.46 B
Enterprise Value120.08 B102.75 B111.62 B127.69 B139.17 B132.18 B
Free Cash Flow4.53 B4.58 B5.4 B4.98 B5.99 B5.84 B
Invested Capital68.34 B70.87 B73.44 B72.72 B74.11 B70.3 B
Invested Capital Average69.58 B70.5 B72.7 B72.73 B73.9 B70.24 B
Market Capitalization93.75 B74.98 B81.62 B98.88 B111.83 B100.19 B
Tangible Asset Value68.65 B70.39 B70.69 B70.62 B75.43 B69.86 B
Working Capital9.31 B10.38 B12.57 B13.75 B13.61 B13.32 B

Caterpillar ESG Sustainability

Some studies have found that companies with high sustainability scores are getting higher valuations than competitors with lower social-engagement activities. While most ESG disclosures are voluntary and do not directly affect the long term financial condition, Caterpillar's sustainability indicators can be used to identify proper investment strategies using environmental, social, and governance scores that are crucial to Caterpillar's managers, analysts, and investors.
Environment Score
Governance Score
Social Score

Caterpillar Fundamentals

About Caterpillar Fundamental Analysis

The Macroaxis Fundamental Analysis modules help investors analyze Caterpillar's financials across various querterly and yearly statements, indicators and fundamental ratios. We help investors to determine the real value of Caterpillar using virtually all public information available. We use both quantitative as well as qualitative analysis to arrive at the intrinsic value of Caterpillar based on its fundamental data. In general, a quantitative approach, as applied to this company, focuses on analyzing financial statements comparatively, whereas a qaualitative method uses data that is important to a company's growth but cannot be measured and presented in a numerical way.
Please read more on our fundamental analysis page.
Last ReportedProjected for 2022
Profit Margin 12.73  13.74 

Be your own money manager

Our tools can tell you how much better you can do entering a position in Caterpillar without increasing your portfolio risk or giving up the expected return. As an individual investor, you need to find a reliable way to track all your investment portfolios. However, your requirements will often be based on how much of the process you decide to do yourself. In addition to allowing all investors analytical transparency into all their portfolios, our tools can evaluate risk-adjusted returns of your individual positions relative to your overall portfolio.

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Pair Trading with Caterpillar

One of the main advantages of trading using pair correlations is that every trade hedges away some risk. Because there are two separate transactions required, even if Caterpillar position performs unexpectedly, the other equity can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Caterpillar will appreciate offsetting losses from the drop in the long position's value.
The ability to find closely correlated positions to Caterpillar could be a great tool in your tax-loss harvesting strategies, allowing investors a quick way to find a similar-enough asset to replace Caterpillar when you sell it. If you don't do this, your portfolio allocation will be skewed against your target asset allocation. So, investors can't just sell and buy back Caterpillar - that would be a violation of the tax code under the "wash sale" rule, and this is why you need to find a similar enough asset and use the proceeds from selling Caterpillar to buy it.
The correlation of Caterpillar is a statistical measure of how it moves in relation to other equities. This measure is expressed in what is known as the correlation coefficient, which ranges between -1 and +1. A perfect positive correlation (i.e., a correlation coefficient of +1) implies that as Caterpillar moves, either up or down, the other security will move in the same direction. Alternatively, perfect negative correlation means that if Caterpillar moves in either direction, the perfectly negatively correlated security will move in the opposite direction. If the correlation is 0, the equities are not correlated; they are entirely random. A correlation greater than 0.8 is generally described as strong, whereas a correlation less than 0.5 is generally considered weak.
Correlation analysis and pair trading evaluation for Caterpillar can also be used as hedging techniques within a particular sector or industry or even over random equities to generate a better risk-adjusted return on your portfolios.
Pair CorrelationCorrelation Matching
Continue to Caterpillar Piotroski F Score and Caterpillar Altman Z Score analysis. Note that the Caterpillar information on this page should be used as a complementary analysis to other Caterpillar's statistical models used to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.

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Is Caterpillar's industry expected to grow? Or is there an opportunity to expand the business' product line in the future? Factors like these will boost the valuation of Caterpillar. If investors know Caterpillar will grow in the future, the company's valuation will be higher. The financial industry is built on trying to define current growth potential and future valuation accurately. All the valuation information about Caterpillar listed above have to be considered, but the key to understanding future value is determining which factors weigh more heavily than others.
Quarterly Earnings Growth YOY
0.49
Market Capitalization
120.9 B
Quarterly Revenue Growth YOY
0.21
Return On Assets
0.0695
Return On Equity
0.46
The market value of Caterpillar is measured differently than its book value, which is the value of Caterpillar that is recorded on the company's balance sheet. Investors also form their own opinion of Caterpillar's value that differs from its market value or its book value, called intrinsic value, which is Caterpillar's true underlying value. Investors use various methods to calculate intrinsic value and buy a stock when its market value falls below its intrinsic value. Because Caterpillar's market value can be influenced by many factors that don't directly affect Caterpillar's underlying business (such as a pandemic or basic market pessimism), market value can vary widely from intrinsic value.
Please note, there is a significant difference between Caterpillar's value and its price as these two are different measures arrived at by different means. Investors typically determine Caterpillar value by looking at such factors as earnings, sales, fundamental and technical indicators, competition as well as analyst projections. However, Caterpillar's price is the amount at which it trades on the open market and represents the number that a seller and buyer find agreeable to each party.