How Does Caterpillar Stock Compare With Peers?
With Caterpillar surging 17% in a Month, it makes sense to re-evaluate vs its peers. Consistently assessing alternatives is core to a sound investment approach. Here is how Caterpillar (CAT) stock stacks up against its peers in size, valuation, growth and margin.
- CAT’s operating margin of 18.2% is strong, lower than most peers – trailing ALSN (30.8%).
- CAT’s revenue growth of -4.9% in the last 12 months is negative, lagging ALSN, TEX, ASTE but outpacing DE.
- CAT gained 50.7% in the past year and trades at a PE of 28.3, outperforming its peers.
As a quick background, Caterpillar provides construction and mining equipment, engines, industrial turbines, and financial services including leases and loans for various industries.
A single stock can be risky, but there is a huge value to a broader, diversified approach we take with the Trefis High Quality Portfolio. Trefis works with Empirical Asset Management — a Boston area wealth manager — whose asset allocation strategies yielded positive returns during the 2008-09 period when the S&P lost more than 40%. Empirical has incorporated the Trefis HQ Portfolio in this asset allocation framework to provide clients with higher returns while taking on lower levels of risk versus the benchmark index.
| CAT | DE | ALSN | TEX | ASTE | |
|---|---|---|---|---|---|
| Market Cap ($ Bil) | 267.3 | 128.2 | 6.8 | 3.1 | 1.0 |
| Revenue ($ Bil) | 63.1 | 43.4 | 3.1 | 5.3 | 1.3 |
| PE Ratio | 28.3 | 24.6 | 9.7 | 19.7 | 22.6 |
| LTM Revenue Growth | -4.9% | -20.9% | -4.2% | 4.6% | 1.2% |
| LTM Operating Margin | 18.2% | 20.0% | 30.8% | 7.3% | 5.9% |
| LTM FCF Margin | 12.3% | 9.4% | 20.5% | 5.2% | 5.9% |
| 12M Market Return | 50.7% | 20.0% | -25.8% | -9.0% | 38.1% |
Why does this matter? CAT just went up 17.3% in a month – peer comparison puts stock performance, valuation, and financials in context – highlighting whether it is truly outperforming, lagging behind, and above all – can this continue? Read Buy or Sell CAT Stock to see if Caterpillar holds up as a quality investment. Furthermore, there is always a risk of fall after a strong rally – see how the stock has dipped and recovered in the past through CAT Dip Buyer Analysis lens.
Revenue Growth Comparison
| LTM | 2024 | 2023 | 2022 | |
|---|---|---|---|---|
| CAT | -4.9% | -3.4% | 12.8% | 16.6% |
| DE | -20.9% | -16.1% | 17.5% | 19.2% |
| ALSN | -4.2% | 6.3% | 9.6% | 15.3% |
| TEX | 4.6% | -0.5% | 16.6% | 13.7% |
| ASTE | 1.2% | -2.5% | 5.0% | 16.3% |
Operating Margin Comparison
| LTM | 2024 | 2023 | 2022 | |
|---|---|---|---|---|
| CAT | 18.2% | 20.2% | 19.3% | 14.9% |
| DE | 20.0% | 22.6% | 24.2% | 17.6% |
| ALSN | 30.8% | 30.8% | 30.3% | 28.3% |
| TEX | 7.3% | 10.3% | 12.4% | 9.5% |
| ASTE | 5.9% | 4.0% | 4.1% | 1.3% |
PE Ratio Comparison
| LTM | 2024 | 2023 | 2022 | |
|---|---|---|---|---|
| CAT | 28.3 | 16.4 | 14.6 | 18.8 |
| DE | 24.6 | 16.5 | 11.5 | 18.3 |
| ALSN | 9.7 | 12.9 | 7.8 | 7.5 |
| TEX | 19.7 | 9.2 | 7.5 | 9.8 |
| ASTE | 22.6 | 178.2 | 25.2 | -9266.7 |
While peer comparison is critical, the Trefis High Quality (HQ) Portfolio, with a collection of 30 stocks, has a track record of comfortably outperforming its benchmark that includes all 3 — the S&P 500, S&P mid-cap, and Russell 2000 indices. Why is that? As a group, HQ Portfolio stocks provided better returns with less risk versus the benchmark index; less of a roller-coaster ride, as evident in HQ Portfolio performance metrics.