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Data-driven stock valuation

Caterpillar Inc (CAT) fair value: what the stock is really worth

We calculate from audited financials what Caterpillar Inc is really worth. The fair value tells you whether the price is too high or too low, the quality score (0 to 100) how solid the business behind it is. 26 models, 37 quality factors, updated daily, free.

  1. Compare price with fair valuebelow fair value = cheap, above = expensive
  2. Check the quality50 and up solid, 75 and up strong
  3. Watch it or check another stockalert when fair value or trend changes

Industrials · US · Market cap $432B · ISIN US1491231015

At a glance

CI Caterpillar Inc logo Caterpillar Inc CAT · US
Price$813.94
Fair Value$307.83
Upside−62.2%
Quality65/100

A solid business, but trading 164% above our fair value of $307.83.

As of Sep 7, 2026, the fair value of Caterpillar Inc is $307.83 per share against a price of $813.94, so the fair value sits 62% below the price. A model estimate from reported figures, not an analyst target.

✓Healthy Growth (revenue 5y +10.1 %/yr)
✓Solidly profitable · 13.3% net margin
✓Moderate debt · generates free cash flow
·0.74% dividend yield
!Mixed vs. peers (6/15)
✓Wide moat 76/100
!Weak on balance sheet: 28 out of 100
!Weak on dividend: 15 out of 100
Evidence: High Range $192.22 to $402.89

Fair value as of: Sep 7, 2026

From 26 valuation models · updated today

Share price −6.6% over the past month.

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What runs behind every stock

26 valuation models 8 families, DCF to NCAV 37 quality factors margins, balance sheet, cashflow, debt 6 AI factors moat, what no ratio measures 2,000+ data points verified, per stock, median

69 individual criteria per stock, every one traceable See the method →

What matters now

  • The price sits above even our optimistic bull case ($402.89). The favourable scenario is already priced in.
  • Solid but not exceptional quality (65/100) and above fair value, neither a clear bargain nor a standout compounder.
  • A fairly wide model range ($192.22 to $402.89) leaves room in how you read the outcome.

Price vs Fair Value (5 years)

$1,065 $152.64 Fair Value $307.83 Jun 2021 Sep 2026

White line = price, green steps = our fair value per fiscal year, dashed = 300-day average. As of Sep 7, 2026.

How to read this chart

60‑month range $152.64 – $1,065 · fair‑value band $192.22 – $402.89 · the $813.94 price screens above the $307.83 fair value. Green steps = our fair value per fiscal year (point-in-time, no hindsight). Dashed = 300-day average. As of Sep 7, 2026.

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Analysis

Caterpillar Inc (CAT) currently trades at $813.94, while our model-based Fair Value estimate is $307.83, implying the stock looks roughly 164.4% overvalued today. The Quality Score stands at 65/100 (solid quality), in the Industrials sector. Bull case: the Growth Earnings group reads highest at a median of $360.66 per share, and 0 of the 26 models we run sit above the $813.94 price. Bear case: the Asset-Based group reads lowest at $31.01, and 26 of the 26 models stay below the price. Evidence for this calculation is high.

Over the trailing twelve months, Caterpillar Inc generated revenue of $70.8B at a net margin of 13.3%. Revenue grew 22.2% year over year. It earns a return on equity of 51.3%. Net debt stands at $33.4B. Fundamentals as of Sep 7, 2026

Scenario range: $192.22 (bear) to $402.89 (bull), the price of $813.94 sits above it. Bear and bull are the same models on cautious and optimistic assumptions, a range, not a price target. The share trades about 14% below its 52-week high and 132% above its 52-week low, currently above its 200-day average. For context, the median of 10 Industrials peers we cover trades at 4% fair-value upside, at −62%, CAT screens richer than that median.

Fair Value models

Based on fiscal year 2025 figures (about 8 months old). Earnings retained since then ($9.45 per share) are deliberately not added.

Each model values the company its own way; the fair value above is the evidence-weighted blend. Evidence (0 to 100) shows how complete a model's inputs are. How we calculate →

Model Bear ⓘBear = the cautious scenario: the same model computed with conservative anchors (lower growth, margins and valuation multiples). Together with Bull it frames a plausible valuation range, not a price target.BaseBull ⓘBull = the optimistic scenario: the same model computed with favourable anchors (higher growth, margins and valuation multiples). Together with Bear it frames a plausible valuation range, not a price target. Evidence
Highest evidence
FCF DCF $223.44 $385.67 $646.85 78
Growth DCF $228.86 $373.10 $591.23 77
Owner Earnings $207.66 $360.35 $606.18 74
All 26 models by family
DCF Models
FCF DCF $223.44 $385.67 $646.85 78
Owner Earnings $207.66 $360.35 $606.18 74
5Y Revenue Exit $162.41 $276.90 $421.71 71
5Y EBITDA Exit $214.23 $374.23 $560.43 74
5Y P/E Exit $225.08 $394.61 $572.60 70
10Y Revenue Exit $175.33 $286.78 $434.59 66
10Y EBITDA Exit $215.09 $356.07 $543.35 67
10Y P/E Exit $222.18 $370.58 $552.89 63
Earnings-Based
Graham-Dodd $131.00 $415.15 $553.12 64
Lynch FV $91.29 $130.42 $169.55 61
PEG = 1.0 $91.29 $130.42 $169.55 57
EPV $138.31 $170.65 $199.40 74
Dividend Discount
Gordon GGM $57.41 $125.34 $210.88 65
DDM Multi-Stage $57.41 $97.59 $130.62 66
Multiples
P/E Multiple $303.41 $404.55 $505.69 63
P/S Multiple $220.12 $293.49 $366.86 58
P/B Multiple $156.21 $208.28 $260.35 55
EV/EBIT $265.34 $368.77 $472.21 66
EV/EBITDA $240.20 $335.26 $430.32 67
EV/Revenue $139.92 $219.16 $298.40 53
Asset-Based
NCAV (Graham) $23.14 $31.01 $46.28 54
Growth DCF
Growth DCF $228.86 $373.10 $591.23 77
Rev-Margin DCF $162.41 $278.22 $412.50 72
Economic Profit
Residual Income $154.08 $231.36 $2,961 64
ROIC Compounder $152.79 $209.26 $276.83 71
Growth Earnings
Growth-Adj P/E $252.46 $360.66 $468.85 67

Widest divergence: Growth Earnings ($360.66) versus Asset-Based ($31.01). Highest evidence: FCF DCF (78).

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Key figures & financial health

P/E ratio 40.9
P/S ratio 5.37 P/E × margin
EPS (TTM) $19.89 price ÷ EPS = P/E 40.9
Dividend yield 0.7% payout 30.4%
Net margin 13.1% FY2025
Return on equity 51.3% TTM
More key figures
Profitability
Return on assets (EBIT) 11.8% avg 5y
Operating margin 18.2% TTM
Growth
Revenue (TTM) $70.8B TTM
Revenue growth (YoY) +22.2% 3y avg +4.4%
EPS growth (YoY) +30.2%
Balance sheet & cash flow
Free cash flow $10.3B FY2025
Net debt $33.4B FY2025 · ≈ 3.2 yrs of FCF

Figures from reported company fundamentals · as of Sep 7, 2026. TTM = trailing twelve months.

Quality Score breakdown

Overall quality 65/100

Of which business quality 62 · Market factors (momentum, volatility) 60

Profitability 61
Margins and returns on capital today
Quality Growth 22
Are margins and returns improving?
Cashflow 68
Earnings quality: real cash, not paper profit
Fin. Strength 51
Balance sheet, leverage, solvency risk
Investment 72
Disciplined investing over empire-building
Low Volatility 32
Calm price path (market factor)
Momentum 67
Price trend over the last 3–12 months (market factor)
52W Momentum 81
Distance to the 52-week high (market factor)
Net Issuance 100
Buybacks instead of dilution

Non-valuation factor families (profitability, growth, cashflow, financial strength, momentum …), each academically grounded. Valuation itself sits in the Fair Value and is deliberately excluded here to avoid double-counting.

All values are scores from 0 to 100 (100 = best against fixed, research-based bands), not percentages. The three market factors (momentum, 52-week proximity, low volatility) are displayed but carry zero weight in the headline number: market sentiment is not a business property.

About the company

Caterpillar Inc. provides construction and mining equipment, off-highway diesel and natural gas engines, industrial gas turbines, and diesel-electric locomotives in the United States and internationally.

Full company description

Caterpillar Inc. provides construction and mining equipment, off-highway diesel and natural gas engines, industrial gas turbines, and diesel-electric locomotives in the United States and internationally. The Construction Industries segment offers asphalt pavers, cold planers, compactors, forestry machines, material handlers, motor graders, pipelayers, road reclaimers, telehandlers, track-type tractors, and track and wheel excavators; backhoe, compact track, skid steer, track-type, and wheel loaders; and related parts and work tools. Its Resource Industries segment provides electric rope and hydraulic shovels, draglines, rotary drills, hard rock vehicles, mining trucks, wheel loaders, off-highway and articulated trucks, wide-body trucks, wheel tractor scrapers and dozers, and landfill and soil compactors; machinery components, and wear and maintenance components; and technology products and services for fleet management, equipment management analytics, autonomous machine capabilities, safety services, and mining performance solutions. The Energy & Transportation segment offers reciprocating engine powered generator sets; reciprocating engines, drivetrain, and integrated systems and solutions; centrifugal gas compressors and related services; and diesel-electric locomotive components, and other rail-related products. Its Financial Products segment provides operating and finance leases, revolving charge accounts, installment sale contracts, repair/rebuild financing, working capital loans, and wholesale financing; and insurance and risk management products and services. The All Other segment offers parts distribution; logistics and distribution services; electronics and control systems; dealer portfolio management; brand management and marketing strategy; and digital investment services. It also provides mining software solutions. The company was formerly known as Caterpillar Tractor Co. Caterpillar Inc. was incorporated in 1925 and is headquartered in Irving, Texas.

Company description, as reported by the company or data provider.

Revenue & earnings trend

FY2021 – FY2025 · reported fiscal years

Caterpillar Inc reported revenue of $67.6B in FY2025 versus $51.0B in FY2021, a compound +7.3%/yr. Reported net income was $8.9B in FY2025, compounding +8.1%/yr from FY2021.

Growth Quality 91/100
Revenue growth appears healthy and is supported by profitability and cash-flow quality.
Latest Revenue (FY 2025)
$67.6B
Latest YoY
+4.3%
Avg. revenue growth/yr (3Y) ⓘMeasures the company's TOTAL revenue from reported annual statements: compound average growth per year (CAGR) from the fiscal year 3, 5 or N years back to the most recent comparable fiscal year. Not per share: buybacks do not change this number, and a merger can appear as a growth jump.
+4.4%
Avg. revenue growth/yr (5Y) ⓘMeasures the company's TOTAL revenue from reported annual statements: compound average growth per year (CAGR) from the fiscal year 3, 5 or N years back to the most recent comparable fiscal year. Not per share: buybacks do not change this number, and a merger can appear as a growth jump.
+10.1%
Avg. revenue growth/yr (40Y) ⓘMeasures the company's TOTAL revenue from reported annual statements: compound average growth per year (CAGR) from the fiscal year 3, 5 or N years back to the most recent comparable fiscal year. Not per share: buybacks do not change this number, and a merger can appear as a growth jump.
+5.9%
Value creation/yr (5Y) ⓘEarnings growth per share (CAGR 5 years) plus dividend yield: value created per share and year.
+12.7%
Earnings growth per share plus dividend yield: the value created per share and year.
Earnings growth per share+12.0%
Dividend yield0.7%
Trend ⓘTwo data points, not a trend model: earnings growth per share over the last 5 fiscal years against the last 10. Labelled "steady" when both rates are within 3 percentage points of each other, otherwise picking up or flattening. Shown only when ten years of history exist.5Y 12.0% vs 10Y 16.7%, flattening
Operating margin (EBIT) ⓘOperating margin then vs now, from reported annual statements. A falling margin after a boom year is the classic peak-earnings signal: the growth rate then leans on an inflated base.10.9% (2020) → 16.6% (2025) · rising
Worst earnings drop103% (2016) (loss year, drop beyond 100%) · in USD
Revenue +7.3%/yr
FY21 $51.0B
FY22 $59.4B
FY23 $67.1B
FY24 $64.8B
FY25 $67.6B
Net income +8.1%/yr
FY21 $6.5B
FY22 $6.7B
FY23 $10.3B
FY24 $10.8B
FY25 $8.9B
Character of growth · EPS growth decomposed (2014-2025) +18.6 % p.a.
Revenue per share +5.3 %

of which total revenue +2.8 % · buybacks/dilution +2.4 %

EBIT margin +11.0 %
Tax rate +0.4 %
Residual (interest, one-offs) +1.1 %

Annual growth per factor. These are factors, not summands: multiplied they give the EPS growth rate, added they do not quite. Start and end points are 3-year averages (details on hover).

CAT screens 164% overvalued. Compare with Deere & Company →

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Caterpillar Inc · Fair Value
$307.83 −164%Fair Value
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Cite: Fair Value Calculator (2026). "Caterpillar Inc Fair Value". https://www.fairvalue-calculator.com/stock/CAT

Recent news

External third-party headlines (Yahoo Finance, Reuters and others), not an editorial selection.

Peer Group

Farm & Heavy Construction Machinery · 150 stocks

How this stock ranks against its industry: the green marker is this stock, the band is the typical 25–75% peer range, and the tick is the median.

Valuation
Quality Score 65 · Top 25%
Fair Value upside −62% · Bottom 25%
Profitability
Return on equity (TTM) 51% · Top 25%
Return on assets 9% · Top 25%
Net margin (TTM) 13% · Top 25%
Operating margin (TTM) 18% · Top 25%
Growth and dividend
Revenue growth 22% · Top 25%
Dividend yield (TTM) 0.7% · Bottom 25%
Balance sheet
Debt / equity 1.44× · Highest 25%

Valuation Multiples vs Farm & Heavy Construction Machinery median · lower = cheaper

P/E (TTM) 40.9× · Priciest 25%
P/B 20.27× · Priciest 25%
P/S (TTM) 6.11× · Priciest 25%
P/FCF 42.1× · Priciest 25%
EV/EBITDA 31.1× · Priciest 25%
PEG 2.25× · Priciest 25%

What the price implies (reverse DCF)

The inverse question: what free-cash-flow growth must Caterpillar Inc deliver for ten years so that today's price is fair in our DCF model? Same formula, same discount rate as the fair value.

Implied FCF growth, 10 years+17.8 % per year
Achieved revenue growth, 5 years+10.1 % p.a.
Sector median revenue growth+4.6 %
FCF yield on price2.69 %
Discount rate (WACC) in the models10.0 %

The price demands an acceleration versus past growth: a high bar the company still has to clear. Ranking of the largest stocks →

Context: sector, industry, market

Strength profile in five axes (Snowflake)

Five quick dimensions, each 0 to 100: VALUE (fair-value potential), FUTURE (revenue growth), PAST (return on equity), HEALTH (low debt), DIVIDEND (yield). Green = this stock, grey = typical sector peer.

VALUEFUTUREPASTHEALTHDIVIDEND
This stock
VALUEFUTUREPASTHEALTHDIVIDEND
Sector peers
VALUE0 · sector 12
FUTURE100 · sector 29
PAST100 · sector 31
HEALTH28 · sector 93
DIVIDEND15 · sector 39

VALUE 0: the price sits above our fair-value range.

Insider activity: 44/100

Values & ESG

Does this company touch areas you may want to avoid? The classification is inferred from sector and industry.

None of the checked exposures detected

Similar stocks

10 more Farm & Heavy Construction Machinery stocks, each showing price versus our Fair Value estimate (as of Sep 7, 2026).

Stock Price Fair Value vs Fair Value
Deere & Company DE $693.53 $182.29 −74%
AB Volvo (publ), VOLVA kr 351.40 kr 288.08 −18%
PACCAR Inc PCAR $122.45 $94.80 −23%
Daimler Truck Holding DTG €45.73 €47.70 +4%
Epiroc AB EPIA kr 272.80 kr 144.14 −47%
Exor N.V EXO €72.10 €123.44 +71%
Sany Heavy Industry Co 600031 ¥19.06 ¥20.84 +9%
Traton SE 8TRA €37.92 €52.60 +39%
Metso Oyj METSO €16.75 €10.73 −36%
XCMG Construction Machinery Co 000425 ¥8.11 ¥11.79 +45%

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Frequently asked questions

Is Caterpillar Inc (CAT) overvalued or undervalued?
As of Sep 7, 2026, our model estimates a fair value of $307.83 versus a price of $813.94, about −62% upside (overvalued).
What is the fair value of CAT?
Our model-based fair value for Caterpillar Inc is $307.83 (as of Sep 7, 2026), built from audited fundamentals. The current price: $813.94.
What is the quality score of CAT?
Caterpillar Inc has a Quality Score of 65/100. It measures business quality (profitability, growth, cash flow, balance-sheet strength, investment discipline, share issuance). Market factors such as price momentum and volatility do not enter the number; they are shown separately in the detail view.
What is the price target for Caterpillar Inc (CAT)?
Our model-based price target is the fair value of $307.83 (as of Sep 7, 2026) from 26 valuation models. Cautious scenario $192.22, optimistic scenario $402.89. It is a calculation from audited fundamentals, not an analyst target.
What is the Caterpillar Inc stock forecast for 2026?
Our models put fair value at $307.83, about −62% upside versus a price of $813.94 (overvalued). Cautious scenario $192.22, optimistic scenario $402.89. The calculation is refreshed regularly with new filings.
What is the revenue of Caterpillar Inc (CAT)?
Caterpillar Inc reported trailing-twelve-month revenue of about $70.8B (latest available figure, as of Sep 7, 2026).
What is the net profit margin of CAT?
The net profit margin of Caterpillar Inc is about 13.3%, meaning it keeps roughly 13.3% of revenue as net income. Based on the latest reported figures.
Does Caterpillar Inc pay a dividend?
Caterpillar Inc currently shows a dividend yield of about 0.74% relative to its recent price (as of Sep 7, 2026).
What growth is priced into Caterpillar Inc (CAT)?
For today's price to be fair in a discounted-cash-flow model, Caterpillar Inc would have to grow free cash flow by +17.8 % per year for ten years (discount rate 10.0 %, then 2 % perpetual growth). Over the last 5 years revenue grew +10.1 % per year. As of Sep 7, 2026.
What discount rate (WACC) does the fair value of CAT use?
Our models discount Caterpillar Inc at 10.0 %: a base by market capitalisation (mega), damped by beta 1.57, country premium for USA. The same rate applies in all 26 models.
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