What is CAT's intrinsic value?

TickerWorth's valuation lenses put Caterpillar Inc. (CAT) between $468.03 and $468.03 per share, versus a market price of $730.76. They disagree too widely for us to state a single fair value, so we publish the range.

Is CAT overvalued or undervalued?

At $730.76 the price sits above every lens we ran. We don't call CAT overvalued or undervalued from a range this wide. This is an educational estimate, not advice.

What discount rate is used for CAT?

A WACC of 11.0% and a terminal growth rate of 2.5%.

Is Caterpillar stock undervalued?

TickerWorth's fair-value range for Caterpillar Inc. (CAT) is $468.03 – $468.03 against a market price of $730.76. Priced above our range. We publish a range here, not one number, so we do not call it over- or undervalued. This is a model estimate, not investment advice.

Caterpillar (CAT) DCF valuation and fair value

Our fair-value range for Caterpillar Inc. (CAT) is $468.03 – $468.03, built on a 11.0% discount rate (WACC) and 2.5% terminal growth. It blends our discounted-cash-flow model with other valuation lenses. Every assumption is listed on this page with its source.

Caterpillar (CAT) insider trading

We have no recent SEC Form 4 insider filings on file for Caterpillar Inc. (CAT). Form 4 covers US-listed companies only.

CAT · Intrinsic value

Is Caterpillar Inc. (CAT) overvalued or undervalued?

Name: Caterpillar Inc. (CAT) DCF intrinsic value
Creator: TickerWorth

As of Oct 19, 2026, TickerWorth publishes a fair-value range of $468.03 – $468.03 for Caterpillar Inc. (CAT), against the delayed market price of $730.76: priced above our range. It is a range, not a single number, so we do not call it over- or undervalued. It is a model estimate, and every input behind it is sourced below.

Model by Miraaj Patel · generated from a hand-researched model · Updated Oct 19, 2026 · How these pages are made

Open full CAT analysis

What is CAT worth?

Fair-value range: $468.03 – $468.03
Market price: $730.76
Gap to fair value: —
Verdict: Priced above our range

Price as of 19 Oct 2026, 13:54 UTC · Prices are delayed.Our valuation lenses disagree too widely on this company for us to publish a single number, so we publish the range instead. We do not call it over- or undervalued from a spread this wide.

Reverse DCF, on our cash-flow model rather than the range above: Today's price implies revenue growth of more than 25%/yr. Above about 25% a year the reverse-DCF stops being informative. It solves for revenue growth alone — holding margins, capital intensity and the forecast horizon fixed — so a price well above our cash-flow model's value has nowhere to go but growth, and the solver returns a rate the model can't reconcile. Read it as "the price implies growth we can't justify", not as a forecast.

What is CAT's TickerWorth Score?

D45/100

Expensive vs our estimate — the business scores well

Compared with Industrials companies in US

Its strongest point: a profitable, high-quality business. Its weakest: trades above our estimate of what it's worth.

Value · 26 of 100
Cheaper than 26% of Industrials companies in US
Price vs worth · 9 of 100
Quality · 73 of 100
More profitable than 73% of Industrials companies in US
Financial health · 32 of 100
Financially stronger than 32% of Industrials companies in US
Growth · 74 of 100
Growing faster than 74% of Industrials companies in US
Momentum · 63 of 100
Outperformed 63% of Industrials companies in US over the past year

Confidence: High confidence · Scored 19 Oct 2026, 13:54 UTC

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Where the numbers come from

Hand-researched model

What the modeller flagged

Consolidated model: base-year FCF/EBIT include Financial Products, but finance-arm debt is excluded — a known inconsistency the standard simplification accepts; flagged.
Beta normalized from a published 1.605 to 1.30. The net-debt CASH split is still an estimate (the debt split is now filed). Both are documented in the source notes.
No SBC adjustment: CAT's stock-based comp is small relative to a $67B revenue base; not separately modeled.
YEAR 1 IS NOT GUIDANCE. CAT issued no numeric FY2026 outlook with Q2. The 17.5% growth and 19.0% margin are mine, built off six months of actuals. The prior file called Year 1 'guidance'; that claim did not survive re-reading the release.
NET WORKING CAPITAL IS THE ONE INPUT NOT REFRESHED THIS PASS. It stays at 12% of incremental revenue, an estimate. H1 2026 operating cash flow grew 41% against operating profit up 36%, which does not suggest a working-capital problem, but I did not rebuild the receivables/inventory/payables bridge from the Q2 balance sheet and am not going to imply that I did.
THE FADE IS THE PLACE TO DISAGREE WITH ME. Years 2-5 hold the prior [8,6,5,4] path because the previous version of this file committed, before Q2, to lengthening the window if the backlog kept growing — and it did. But there is an honest case for the opposite: a cyclical reverts to a LEVEL, not to a growth rate, and compounding 8% off a peak Year 1 reaches $99.3B by 2030, which may exceed mid-cycle capacity. Steepening Y2-Y5 to [7,5,4,3.5] lowers the implied value $6.29/share — $264.50 to $258.21, measured by running both. Small next to the $528 gap to the market price — which is why it was not worth resolving by quietly overriding a written-down commitment.

Why CAT gets a range, not one number

At a recent price of $730.76, Caterpillar Inc. (CAT) sits above every lens we ran: our valuation lenses put the business somewhere between $468.03 and $468.03 per share. They disagree too widely for us to state a single fair value. We publish the range rather than a midpoint because a number that precise would claim more than the methods can support. This is an educational model, not a price target or a recommendation.

Read the full reasoning

The valuation discounts Caterpillar Inc.'s projected free cash flows at a weighted-average cost of capital (WACC) of 11.0%, with a long-run terminal growth rate of 2.5%. About 68% of the enterprise value comes from the terminal value — the portion beyond the explicit forecast window — which is typical for a stable, cash-generative business and a reminder that small changes in the discount rate or terminal growth assumption swing the intrinsic value meaningfully.

Running the DCF in reverse — solving for the growth the current price already assumes — CAT would need sustained revenue growth of more than 25%/yr to justify today's price, against about 8.0% a year compounded in our base case. We don't quote a precise figure here, because past about 25% a year the reverse-DCF stops being informative: it solves for revenue growth alone, holding margins, capital intensity and the forecast horizon fixed, so a price well above our fair value has nowhere to go but growth. The honest reading is that the price implies growth this model can't reconcile — not that we forecast it.

Sensitivity matters more than any single number. Across a reasonable band of discount-rate assumptions, CAT's modeled DCF value ranges from about $207.24 to $369.07 per share. If that range still sits below today's price, the market is optimistic relative to the model across the whole band; if it brackets the price, the stock is roughly fairly valued on our assumptions. Use the interactive slider to see exactly where your own cost-of-capital view lands.

How to read this page: the DCF fair value is what Caterpillar Inc. would be worth if its cash flows grow as modeled and are discounted at the stated WACC. The assumptions table shows every input and its source; the reverse-DCF shows what the market believes; the sensitivity band shows how fragile the answer is. None of this is investment advice — it is a transparent, auditable framework for forming your own view of CAT's intrinsic value. Figures update as new filings and prices come in.

Every input behind CAT's DCF

Input	Value	Source
Base-year revenueCAT FY2025 10-K (accession 0000018230-26-000008): Revenues, us-gaap:Revenues, FY2025 10-K. UNCHANGED and still the base: the DCF grows this figure by forecast.revenue_growth, so the new quarter belongs in the forecast, not here. CROSS-CHECK at 2026-08-31: TTM revenue through 2026-06-30 is $74,729M (67,589 - H1'25 30,818 + H1'26 37,958), i.e. the company is already 10.6% above this base.	$67,589,000,000	CAT FY2025 10-K (accession 0000018230-26-000008): Revenues, us-gaap:Revenues, FY2025 10-K. UNCHANGED and still the base: the DCF grows this figure by forecast.revenue_growth, so the new quarter belongs in the forecast, not here. CROSS-CHECK at 2026-08-31: TTM revenue through 2026-06-30 is $74,729M (67,589 - H1'25 30,818 + H1'26 37,958), i.e. the company is already 10.6% above this base.
Base EBIT marginCAT FY2025 10-K: Operating income $11,151M / revenue $67,589M = 16.50%, FY2025 10-K. Reference figure only — the cash-flow math uses forecast.ebit_margin, not this. CROSS-CHECK: H1 2026 ran 19.44% ($7,380M / $37,958M) and Q2 2026 alone 20.91%, so FY2025's 16.50% is no longer the operating reality; see the forecast margin path.	16.5%	CAT FY2025 10-K: Operating income $11,151M / revenue $67,589M = 16.50%, FY2025 10-K. Reference figure only — the cash-flow math uses forecast.ebit_margin, not this. CROSS-CHECK: H1 2026 ran 19.44% ($7,380M / $37,958M) and Q2 2026 alone 20.91%, so FY2025's 16.50% is no longer the operating reality; see the forecast margin path.
Forecast revenue growthESTIMATEAssumption — TickerWorth's 5-year explicit forecast	18% → 8% → 6% → 5% → 4%	ESTIMATEAssumption — TickerWorth's 5-year explicit forecast
Risk-free rateUS 10Y Treasury constant maturity: 4.67% at 2026-08-27, the latest published observation. Was 4.57% at 2026-07-16.	4.7%	US 10Y Treasury constant maturity: 4.67% at 2026-08-27, the latest published observation. Was 4.57% at 2026-07-16.
BetaESTIMATEAssumption — normalized estimate: Published yfinance beta is now 1.605 (was 1.565) — still read as distorted by AI-driven re-rating volatility, so the 1.30 normalization is HELD, not re-derived. NB: this override remains generous to CAT (lowers WACC, raises value). The stock has fallen ~11% since this model was last touched and still screens expensive.	1.30	ESTIMATEAssumption — normalized estimate: Published yfinance beta is now 1.605 (was 1.565) — still read as distorted by AI-driven re-rating volatility, so the 1.30 normalization is HELD, not re-derived. NB: this override remains generous to CAT (lowers WACC, raises value). The stock has fallen ~11% since this model was last touched and still screens expensive.
Terminal growthESTIMATEAssumption — house default: Default 2.5% (roughly long-run nominal GDP); must be < WACC of ~10.85%.	2.5%	ESTIMATEAssumption — house default: Default 2.5% (roughly long-run nominal GDP); must be < WACC of ~10.85%.
Diluted sharesCAT Q2 2026 10-Q (accession 0000018230-26-000046, filed 2026-08-05): 459.7M common shares outstanding at 2026-06-30 per the Q2 10-Q balance sheet (was 460.6M at 2026-03-31). Weighted-diluted for H1 2026 was 464.3M and for Q2 alone 462.5M; the period-end count is used because buybacks are still running — $1.5B in Q2 alone.	460M	CAT Q2 2026 10-Q (accession 0000018230-26-000046, filed 2026-08-05): 459.7M common shares outstanding at 2026-06-30 per the Q2 10-Q balance sheet (was 460.6M at 2026-03-31). Weighted-diluted for H1 2026 was 464.3M and for Q2 alone 462.5M; the period-end count is used because buybacks are still running — $1.5B in Q2 alone.
Market priceDelayed quote · as of 2026-10-19 13:54 UTC	$730.76	Delayed quote · as of 2026-10-19 13:54 UTC

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What does Caterpillar Inc. do?

What does it do?

Caterpillar Inc. manufactures and sells construction and mining equipment, including excavators, loaders, and dozers, as well as diesel engines, gas turbines, and locomotives. The company operates through Construction Industries and Resource Industries segments and employs 118,000 people globally.

How does it make money?

Caterpillar generates revenue by selling heavy machinery and equipment to construction and mining customers. In its most recent period, the company reported total revenue of $74.7 billion with a gross margin of 29.7% and an operating margin of 22.2%.

Is it financially healthy?

Caterpillar's net margin is 14.5%, indicating profitability, but its debt-to-equity ratio of 2.33 shows the company carries substantial debt relative to shareholder equity. Its current ratio of 1.37 suggests adequate short-term liquidity to cover near-term obligations.

CAT insider trading

We have no recent SEC Form 4 insider filings on file for Caterpillar Inc.. Form 4 covers US-listed companies only.

Common questions

What is CAT's intrinsic value?
TickerWorth's valuation lenses put Caterpillar Inc. (CAT) between $468.03 and $468.03 per share, versus a market price of $730.76. They disagree too widely for us to state a single fair value, so we publish the range.
Is CAT overvalued or undervalued?
At $730.76 the price sits above every lens we ran. We don't call CAT overvalued or undervalued from a range this wide. This is an educational estimate, not advice.
What discount rate is used for CAT?
A WACC of 11.0% and a terminal growth rate of 2.5%.
Is Caterpillar stock undervalued?
TickerWorth's fair-value range for Caterpillar Inc. (CAT) is $468.03 – $468.03 against a market price of $730.76. Priced above our range. We publish a range here, not one number, so we do not call it over- or undervalued. This is a model estimate, not investment advice.
Caterpillar (CAT) DCF valuation and fair value
Our fair-value range for Caterpillar Inc. (CAT) is $468.03 – $468.03, built on a 11.0% discount rate (WACC) and 2.5% terminal growth. It blends our discounted-cash-flow model with other valuation lenses. Every assumption is listed on this page with its source.
What growth is priced into Caterpillar stock?
Today's price implies revenue growth of more than 25%/yr. Above about 25% a year the reverse-DCF stops being informative. It solves for revenue growth alone — holding margins, capital intensity and the forecast horizon fixed — so a price well above our cash-flow model's value has nowhere to go but growth, and the solver returns a rate the model can't reconcile. Read it as "the price implies growth we can't justify", not as a forecast. This is a reverse DCF: it holds our cash-flow model's other inputs and solves for the revenue growth that makes the model equal today's price of $730.76. A model estimate, not investment advice.
Caterpillar (CAT) insider trading
We have no recent SEC Form 4 insider filings on file for Caterpillar Inc. (CAT). Form 4 covers US-listed companies only.