MODEL VERDICT
Caterpillar Inc. (CAT)
Relative Valuation•Peer multiples, Monte Carlo simulation & quality-adjusted fair value
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Composite score derived from valuation, quality, and risk factors
Quantitative model thresholds · For educational and research purposes only
Each row records the model's monthly assessment. High Conviction = the model detected notable undervaluation vs peers. Neutral = no notable divergence was found. The return column shows the actual price change over 90 days for reference. This is a quantitative observation log — not investment advice.
| Date | Assessment | Score | Price | Status | 90d Fwd Return |
|---|---|---|---|---|---|
| May 1, 2026 | NEUTRAL | 0.24 | $889.67 | CURRENT | — |
| Apr 24, 2026 | NEUTRAL | 0.23 | $830.79 | CURRENT | — |
| Apr 17, 2026 | NEUTRAL | 0.23 | $794.65 | CURRENT | — |
| Apr 16, 2026 | NEUTRAL | 0.23 | $770.17 | CURRENT | — |
| Apr 10, 2026 | NEUTRAL | 0.25 | $790.66 | CURRENT | — |
Historical model observations for research purposes only. Past quantitative patterns do not predict future results. Not a recommendation to buy, sell, or hold any security.
| Methodology | Fair Value | vs Current | Weight | Quality | Status |
|---|---|---|---|---|---|
| Forward P/E 10 analyst estimates | $525.02 | -41.0% | 20% | A- | Analyst Est. |
| EV/EBITDA 10 industry peers | $345.02 | -61.2% | 20% | A- | Peer Data |
| Industry Median P/E 10 industry peers | $482.98 | -45.7% | 15% | A | Peer Data |
| Price / Free Cash Flow 10 industry peers | $459.68 | -48.3% | 15% | B+ | Peer Data |
| EV/EBIT 10 industry peers | $363.14 | -59.2% | 8% | B+ | Peer Data |
| EV/FCF 10 industry peers | $496.47 | -44.2% | 7% | B | Model Driven |
| Peg Ratio 8 industry peers | $1279.69 | +43.8% | 5% | B | Data |
| EV To Revenue 10 industry peers | $221.54 | -75.1% | 4% | B | Data |
| Price / Sales 10 industry peers | $261.75 | -70.6% | 3% | B | Model Driven |
| Earnings Yield 10 industry peers | $482.98 | -45.7% | 2% | B | Data |
| FCF Yield 10 industry peers | $458.98 | -48.4% | 1% | B | Data |
| Weighted Output Blended model output | $488.46 | -45.1% | 100% | 90 | SIGNIFICANTLY OVERVALUED |
| EPS Growth ↓ | P/E Multiple → | 39× | 43× | 47× (Current) | 51× | 55× |
|---|---|---|---|---|---|
| Bear Case (11%) | $817 | $901 | $984 | $1068 | $1152 |
| Conservative (18%) | $868 | $958 | $1047 | $1136 | $1225 |
| Base Case (28.1%) | $941 | $1037 | $1134 | $1230 | $1327 |
| Bull Case (38%) | $1013 | $1117 | $1220 | $1324 | $1428 |
Cross-sectional regression predicting expected multiples based on growth, margins, ROIC, and beta.
| Multiple | Avg | Median | Min | Max | Std |
|---|---|---|---|---|---|
| P/E Ratio | 20.73 | 17.48 | 13.75 | 33.34 | 7.85 |
| EV/EBIT | 18.43 | 16.33 | 13.48 | 28.31 | 5.54 |
| EV/EBITDA | 15.51 | 15.38 | 11.18 | 22.42 | 3.85 |
| P/FCF | 21.98 | 23.71 | 15.51 | 26.15 | 3.69 |
| P/FFO | 15.02 | 13.71 | 9.67 | 24.13 | 4.80 |
| P/TBV | 13.07 | 12.81 | 11.14 | 17.05 | 1.87 |
| P/AFFO | 19.32 | 18.25 | 11.88 | 27.78 | 5.11 |
| P/B Ratio | 8.08 | 7.79 | 5.73 | 12.60 | 2.28 |
| Div Yield | 0.02 | 0.02 | 0.01 | 0.03 | 0.01 |
| P/S Ratio | 2.47 | 2.26 | 1.56 | 3.98 | 0.75 |
Based on our peer multiples analysis with 28 valuation metrics, the model estimates CAT's fair value at $488.46 vs the current price of $889.67, implying -45.1% downside potential. Model verdict: Significantly Overvalued. Confidence: 90/100. This is a quantitative estimate, not a recommendation.
The blended fair value of $488.46 is calculated using four lenses: industry median multiples (40%), historical multiples (30%), forward estimates (20%), and quality-adjusted multiples (10%). Monte Carlo simulation (10,000 iterations) gives a range of $381.61 (P10) to $490.08 (P90), with a median of $435.70.
CAT's current P/E of 47.2x compares to the industry median of 25.6x (10 peers in the group). This represents a +84.2% premium to the industry. The historical average P/E is 20.7x over 7 years. Signal: High Premium.
53 analysts cover CAT with a consensus rating of Buy. The consensus price target is $824.80 (range: $650.00 — $1165.00), implying -7.3% upside from the current price. Grade breakdown: Strong Buy (0), Buy (25), Hold (21), Sell (7), Strong Sell (0).
The model confidence score is 90/100, based on: data completeness (30), peer quality (25), historical depth (20), earnings stability (8), and model agreement (7). Cyclicality penalty: -0 points. The model shows strong agreement across inputs.
The model flags several key risks: (1) Multiple compression: CAT trades at the 8460th percentile of its historical P/E range. A reversion to median (20.7×) would imply significant downside. (2) Macro/regulatory risks are not captured in this model but remain material.
Peak earnings risk refers to the possibility that CAT's current profitability is above its sustainable long-term trend. The model detects a margin Z-score of -0.1σ, meaning margins are 0.1 standard deviations below their historical average. If margins revert to the 7-year mean (17.0%), the model estimates fair value drops by 4400.0% to approximately $498. This isn't a prediction — it's a scenario analysis.
No. This dashboard is a quantitative research tool for educational and informational purposes only. It is not investment advice, a solicitation, or a recommendation to buy, sell, or hold any security. The operator of this platform is not a registered investment advisor (RIA), broker-dealer, or financial planner. All model outputs, fair value estimates, signals, and scenarios are the result of automated quantitative computations and should not be construed as professional financial guidance. You should consult a qualified, licensed financial advisor before making any investment decisions. Past model performance is not indicative of future results.