Caterpillar Inc. · Farm & Heavy Construction Machinery
FCF$7.9bB+
Rev+11.8%B
D/E2.31D
P/E44.2xC
PEG1.91C+
44.5Score
$887.23$382.3B
1Y Target$958.83Analyst consensus · 26 analysts
5Y Target$1,404Compound horizon
10Y Target$2,082Long-dated conviction
FCF$7.9bTTMB+
FCF $7.9b — strong cash profile, above most peers
Rev+11.8%TTM YoYB
Revenue +11.8% — at or above S&P median
D/E2.31D
D/E 2.31 — most levered decile in Industrials (≈95th pctile)
P/E44.2xC
P/E 44.2 — expensive vs Industrials peers (≈90th pctile)
PEG1.91C+
PEG 1.91 — modest premium; above fair value
Forward price target — the 1-year figure is the analyst consensus where the stock is covered; the 5- and 10-year figures compound our earnings estimate from there. The DCF below is a separate cross-check on intrinsic value (what it's worth today), not another target.
Quality-growth score · 44.5
Quality0.74
Growth0.50
Value0.24
Why this score
Buying back stock
Raising its dividend
Cyclical growth
Entry · Margin of safety
52-week rangeNear 52-week high
17% off the 12-month high
vs DCF fair value219% aboveest. fair value ~$278
What the price assumes: free cash flow compounding at ~47% a year for the next decade — vs the ~23% a year our model projects from current growth and analyst estimates.
Quality signals · context only
Gross profitability25% · Bgross profit ÷ total assets (Novy-Marx)
ROIC16.8% · A-return on invested capital — not score-weighted
Why now
Farm & Heavy Construction Machinery · market cap $382.3b. 17% off the 52-week high of $1073.46. Revenue growing +12%, comfortably above the S&P median. 26 sell-side analysts rate this a Buy with a mean 1-yr target of $958.83 (implying +8% upside).
Moat
Net margin 13% beats the market median by a meaningful margin — the company is keeping more of every revenue dollar than the average S&P constituent. ROE 51% — top-decile capital efficiency. Either pricing leverage, low capital intensity, or aggressive buybacks; the durability story depends on which. $382.3b market cap places it among the largest companies in the sector — distribution, R&D, and customer-acquisition costs amortize across a base peers can't replicate.
Risk
D/E 2.31 is elevated — limits strategic flexibility and raises refinancing exposure if rates stay higher for longer. Beta 1.60 implies above-market volatility — position-size to the drawdowns this name will produce in a market correction, not to its bull-case return. Trailing P/E 44x sits well above the S&P median (~20x) — multiple compression is a real risk if revenue growth decelerates.
Horizon
1-3 yr $958.83 (26-analyst consensus) — fundamentals + valuation re-rating. 5 yr $1,404 at ~10% CAGR — compounding case rests on the competitive position widening. 10 yr $2,082 if current growth sustains into durable earnings power.
Not investment advice. The Bull Rankings publishes a quantitative ranking model and accompanying analysis for general informational purposes only. Nothing on this page is a recommendation to buy, sell, or hold any security; nothing is personalized to your circumstances, risk tolerance, or tax situation. Investing carries the risk of loss — invest at your own risk and consider consulting a licensed financial professional before acting on anything you read here. See terms and methodology for full disclosures.
CAT vs the Top Picks average
Pillar
CAT
Book avg
Diff
Quality
0.74
0.83
-0.09
Growth
0.50
0.91
-0.41
Value
0.24
0.75
-0.51
Averaged across the 30 names in today's Top Picks (mean score 81.8). A name can beat these averages and still be absent from the book — it also applies concentration limits.
Score history · CAT
Trend
+4.3 over 32 daily scores
From 40.2 (Jun 22) → 44.5 (now)
One point per daily model run. The range autoscales, so a flat-looking line can still hide 1–2 point moves — read the From → To values for the actual range.
Position sizing · CAT
$
%
%
Shares to buy
2
Position size
$1,774
3.5% of portfolio
Stop price
$665.42
25% below $887.23
$ at risk if stopped
$443.62
budget $500.00 · 1% of portfolio
Math only — share count is floor(portfolio × risk% ÷ (price × stop%)). Doesn't account for commissions, slippage, gap risk, or position-correlation across your book. Inputs persist locally; never sent to the server. Not investment advice.
Caterpillar Inc. (CAT): score, valuation & FAQ
Caterpillar Inc. (CAT) is a Farm & Heavy Construction Machinery company that scores 44.5 out of 100 on the Bull Rankings quality-growth model — a below-average reading. The score blends three pillars — quality (durable returns, healthy margins, low leverage), growth (revenue and earnings), and value (valuation versus sector peers) — into one number, refreshed daily; it is a screen, not a buy recommendation.
Its strongest graded signals are FCF (B+), while D/E (D) rate weaker. On valuation, CAT sits about 219% above our discounted-cash-flow fair value — the current price implies roughly 47% annual free-cash-flow growth over the next decade.
Is CAT a good stock to buy?
Bull Rankings scores CAT 44.5 out of 100 on its quality-growth model, which is a below-average reading. That is driven by FCF (B+). A score is a quantitative screen of Caterpillar Inc.'s fundamentals, not personalised financial advice — weigh it against your own time horizon and risk tolerance, and read the risk factors below before acting.
Why does CAT score 44.5 on Bull Rankings?
The quality-growth score blends three pillars — quality (returns on capital, margins, leverage, earnings quality), growth (revenue and earnings expansion), and value (valuation versus sector peers). CAT earns its highest marks on FCF (B+), and is held back by D/E (D). Each pillar is graded against sector-aware thresholds, then combined into the single 0–100 score.
Is CAT overvalued or undervalued?
Based on $887.23, CAT sits about 219% above our discounted-cash-flow fair value — the current price implies roughly 47% annual free-cash-flow growth over the next decade. It trades at a 44.2x× P/E (graded C). Discounted-cash-flow estimates are sensitive to growth and discount-rate assumptions, so treat this as a cross-check, not a price target.
What are the main risks of investing in CAT?
D/E 2.31 is elevated — limits strategic flexibility and raises refinancing exposure if rates stay higher for longer. Beta 1.60 implies above-market volatility — position-size to the drawdowns this name will produce in a market correction, not to its bull-case return. Trailing P/E 44x sits well above the S&P median (~20x) — multiple compression is a real risk if revenue growth decelerates.
Bull Rankings is an automated fundamentals screen for research and education. It is not investment advice, and nothing here is a recommendation to buy or sell any security. Do your own research and consider consulting a licensed financial adviser.