Industrial Goods Sector Christian Fleming, MD Alexandra Smith, Analyst Kairavi Mehta, Analyst Vani Patro, Analyst.

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Presentation transcript:

Industrial Goods Sector Christian Fleming, MD Alexandra Smith, Analyst Kairavi Mehta, Analyst Vani Patro, Analyst

Company Description Caterpillar Inc. manufactures, remanufactures, and provides logistical services for many industries. Caterpillar offers tools and machinery for heavy construction, forestry, excavation, and systems and solutions for the marine and petroleum industries. Caterpillar Inc. – Capital IQ

Company Sectors ConstructionMining Engines and Turbine

Company Basic Information Company Name Caterpillar Inc. TickerCAT Current Price (11/04/12) $ ‎ (-2.12%‎) 52 week range $ $ Target Price$ Google Finance

Historic Price Chart

Company SWOT Analysis FavorableUnfavorable InternalStrengths: Leading market position Strong portfolio of brands Wide logistics Weaknesses: High debt to equity ratio ExternalOpportunities: Acquisitions in capital intensive industries Strategic alliances and investments Growing presence in China and India Threat: Increase in raw material costs Strong competition Foreign exchange and interest rate fluctuations

Key Figures Market Cap: $56.1B P/E Ratio: 8.79 EPS: 9.76

Stock Analysis Caterpillar Inc. Komatsu Ltd.Industry P/E Ratio Market Cap $56.1B$20.90B$907.9M EPS Beta

Growth and Margin Analysis Sales Growth 31.5%41.2%20.4% Gross Margin 26.5%26.2%27.3% Profit Margin 6.3%8.2%9.7% Sales Growth 28.7%7.5%(2.2)% Gross Margin 27.1%27.3%27.0% Profit Margin 8.2%8.4%7.2% Sales Growth 22.1%8.0%10.4% Gross Margin 12.8%13.3%11.8% Profit Margin5.4%5.5%3.9% Machinery-Construction & Mining

Profitability and Turnover ROIC6.3%10.2%11.1% ROE26.7%40.3% ROA4.1%6.2%7.1% Total Asset Turnover 0.7x0.8x Cash conversion cycle ROIC3.5%9.8%10.1% ROE4.8.%17.1%17.4% ROA2.6%7.1%7.3% Asset Turn 0.7x0.9x CCC ROIC5.9%7.2%9.4% ROE12.2%13.7%10.0% ROA3.4%4.4%5.8% Total Asset Turnover 0.7x0.8x Cash conversion cycle Machinery-Construction & Mining

Leverage and Liquidity Debt/ equity 56.0%61.4%58.7% Debt/ Assets 54.7%54.4%52.1% Quick Ratio 0.8x0.7x Current ratio 1.6x Debt/ Equity251.2%258.2%222.2% Debt/ Asset82.3%83.5%80.2% Quick Ratio0.9x0.7x0.8x Current Ratio 1.4x1.3x1.4x Debt/ Equity89.0%59.1%57.4% Debt/ Asset70.1%62.4%63.1% Quick Ratio1.7x 1.6x Current Ratio0.9x 1.0x Machinery-Construction & Mining

Analyst Opinions

Recommendation Buy 100 shares 1.Caterpillar has a low P/E ratio in comparison to competitors and industry with high earnings per share. 2.Analysts have deemed the stock overweight, indicating that it is out performing the industry 3.It has a history of immense growth, depicted by the revenue growth.