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

2. 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

3. Company Sectors ConstructionMining Engines and Turbine

4. Company Basic Information Company Name Caterpillar Inc. TickerCAT Current Price (11/04/12) $85.79 -1.86‎ (-2.12%‎) 52 week range $78.25 - $116.95 Target Price$105.00 Google Finance

5. Historic Price Chart

6. 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

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

8. Stock Analysis Caterpillar Inc. Komatsu Ltd.Industry P/E Ratio8.7911.9217.21 Market Cap $56.1B$20.90B$907.9M EPS9.761.84 Beta1.831.40

9. Growth and Margin Analysis 201020112012 Sales Growth 31.5%41.2%20.4% Gross Margin 26.5%26.2%27.3% Profit Margin 6.3%8.2%9.7% 201020112012 Sales Growth 28.7%7.5%(2.2)% Gross Margin 27.1%27.3%27.0% Profit Margin 8.2%8.4%7.2% 201020112012 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

10. Profitability and Turnover 201020112012 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 111.0107.0121.2 201020112012 ROIC3.5%9.8%10.1% ROE4.8.%17.1%17.4% ROA2.6%7.1%7.3% Asset Turn 0.7x0.9x CCC176.8149.0171.4 201020112012 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 29.432.131.3 Machinery-Construction & Mining

11. Leverage and Liquidity 201020112012 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 201020112012 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 201020112012 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

12. Analyst Opinions

13. 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.