DCF Tool

CAT

Caterpillar Inc. – Heavy Duty Truck Manufacturing
Since 1925, Caterpillar Inc. has been helping our customers build a better world - making sustainable progress possible and driving positive change on every continent. With 2019 sales and revenues of $53.8 billion, Caterpillar is the world's leading manufacturer of construction and mining equipment, diesel and natural gas engines, industrial gas turbines and diesel-electric locomotives. Services offered throughout the product life cycle, cutting-edge technology and decades of product expertise set Caterpillar apart, providing exceptional value to help our customers succeed. The company principally operates through three primary segments - Construction Industries, Resource Industries and Energy & Transportation - and provides financing and related services through its Financial Products segment.
Analysis Results
Intrinsic Value $448.36
Latest Price $212.99
Relative Value 52% undervalued
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Cash Flow (Billions)
Analysis Parameters
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Analysis Details
Growth Rate Projection

An exponential growth model was fit to the past cash flow data, giving more weight to more recent years. This model determined a growth rate estimate of 12.5%.

Weighted Average Cost of Capital (WACC)

The calculated WACC is 5.5%. This value is used as the default discount rate.

Value of Future Flows

Assuming a growth rate of 12.5%, the cash flows for the next 5 years are projected.

The present value of each year's flow is adjusted to present value using the discount rate.

Year Future flow (billion) Present value (billion)
2022 6.09 5.77
2023 6.85 6.15
2024 7.7 6.56
2025 8.66 6.99
2026 9.74 7.46
Terminal Value

Assuming a growth rate after the projection years of 2.0%, the terminal value of the company would be 284 billion. This corresponds to a present value of 206 billion.

Intrinsic Value Per Share

The total present value of the projected cash flows is 32.9 billion. Adding in the terminal value gives a total present value of 239 billion.

There are presently 533.0 million outstanding shares, so the intrinsic value per share is 448.36.

Financial Statements

The following data was to determine the past cash flows.

Current Assets 43,455,000,000
Current Cash 8,428,000,000
Current Liabilities 46,134,000,000
Current Debt 54,000,000
Non-Cash Working Capital (NCWC) -11,053,000,000
Change in NCWC -1,158,000,000
EBIT 6,909,000,000
Tax Provision 1,742,000,000
Depreciation and Amortization 2,352,000,000
Capital Expenditure -2,472,000,000
Unlevered Free Cash Flow 4,169,496,903
Current Assets 39,464,000,000
Current Cash 8,822,000,000
Current Liabilities 41,967,000,000
Current Debt 1,430,000,000
Non-Cash Working Capital (NCWC) -9,895,000,000
Change in NCWC 1,967,000,000
EBIT 4,567,000,000
Tax Provision 1,006,000,000
Depreciation and Amortization 2,432,000,000
Capital Expenditure -978,000,000
Unlevered Free Cash Flow 6,841,978,049
Current Assets 39,193,000,000
Current Cash 7,299,000,000
Current Liabilities 43,761,000,000
Current Debt 5,000,000
Non-Cash Working Capital (NCWC) -11,862,000,000
Change in NCWC 1,706,000,000
EBIT 8,318,000,000
Tax Provision 1,746,000,000
Depreciation and Amortization 2,577,000,000
Capital Expenditure -2,669,000,000
Unlevered Free Cash Flow 8,079,547,448
Current Assets 38,603,000,000
Current Cash 6,968,000,000
Current Liabilities 45,213,000,000
Current Debt 10,000,000
Non-Cash Working Capital (NCWC) -13,568,000,000
Change in NCWC 411,000,000
EBIT 8,442,000,000
Tax Provision 1,698,000,000
Depreciation and Amortization 2,766,000,000
Capital Expenditure -1,276,000,000
Unlevered Free Cash Flow 8,516,016,059
Current Assets 36,244,000,000
Current Cash 7,381,000,000
Current Liabilities 42,849,000,000
Current Debt 7,000,000
Non-Cash Working Capital (NCWC) -13,979,000,000
Change in NCWC -891,000,000
EBIT 4,522,000,000
Tax Provision 3,339,000,000
Depreciation and Amortization 2,877,000,000
Capital Expenditure -898,000,000
Unlevered Free Cash Flow 1,925,530,014
Current Assets 31,967,000,000
Current Cash 5,257,000,000
Current Liabilities 40,514,000,000
Current Debt 716,000,000
Non-Cash Working Capital (NCWC) -13,088,000,000
Change in NCWC -146,000,000
EBIT 1,179,000,000
Tax Provision 192,000,000
Depreciation and Amortization 3,034,000,000
Capital Expenditure -2,928,000,000
Unlevered Free Cash Flow 947,000,000
Current Assets 34,418,000,000
Current Cash 5,340,000,000
Current Liabilities 42,546,000,000
Current Debt 526,000,000
Non-Cash Working Capital (NCWC) -12,942,000,000
Change in NCWC 157,000,000
EBIT 3,256,000,000
Tax Provision 742,000,000
Depreciation and Amortization 3,046,000,000
Capital Expenditure -3,261,000,000
Unlevered Free Cash Flow 2,351,782,136
Current Assets 38,867,000,000
Current Cash 6,317,000,000
Current Liabilities 46,168,000,000
Current Debt 519,000,000
Non-Cash Working Capital (NCWC) -13,099,000,000
Change in NCWC -1,596,000,000
EBIT 5,336,000,000
Tax Provision 1,380,000,000
Depreciation and Amortization 3,163,000,000
Capital Expenditure -3,379,000,000
Unlevered Free Cash Flow 2,077,588,685
Current Assets 38,335,000,000
Current Cash 4,597,000,000
Current Liabilities 46,017,000,000
Current Debt 776,000,000
Non-Cash Working Capital (NCWC) -11,503,000,000
Change in NCWC -3,629,000,000
EBIT 5,622,000,000
Tax Provision 1,319,000,000
Depreciation and Amortization 3,087,000,000
Capital Expenditure -4,446,000,000
Unlevered Free Cash Flow -813,758,297
Current Assets 42,524,000,000
Current Cash 3,306,000,000
Current Liabilities 48,841,000,000
Current Debt 1,749,000,000
Non-Cash Working Capital (NCWC) -7,874,000,000
Change in NCWC 266,000,000
EBIT 9,167,000,000
Tax Provision 2,528,000,000
Depreciation and Amortization 2,813,000,000
Capital Expenditure -5,076,000,000
Unlevered Free Cash Flow 4,361,008,969

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