Summary Analysis
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CAT is fairly valued compared to its Price of $109.40 per share, has well above average safety, and is currently rated a Buy.
CaterpillarMachinery (Const\Mining)
Detailed Analysis
GRT (Earnings Growth Rate): GRT reflects a company's one to three year forecasted earnings growth rate in percent per year. CAT has a forecasted Earnings Growth Rate of 23.00%. GRT is computed from historical, current and forecasted earnings data. If a stock's GRT trend is upward, the stock's price will likely rise. If GRT is trending downward, the stock's Price will probably fall.
EPS (Earnings per Share): EPS stands for leading 12 months Earnings Per Share. CAT has a forecasted EPS of $6.53 per share.
PE (Price to Earnings Ratio): P/E is a popular measure of stock valuation which shows the dollars required to buy one dollar of earnings. CAT has a PE of 16.75. This ratio may be deemed to be high or low depending upon your frame of reference. P/E is computed daily using the formula: P/E = Price/EPS.
EY (Earnings Yield): EY reflects earnings per share as a percent of Price. EY is related to P/E via the formula, EY = 100 / (P/E), and may be used in place of P/E as a measure of valuation. EY has the advantages that it is always determinate and can reflect negative earnings. CAT has an EY of 5.97% percent. EY equals 100 x (EPS/Price).
GPE (Growth to P/E Ratio): GPE is another popular measure of stock valuation. It compares earnings growth rate to P/E ratio. CAT has a GPE rating of 1.38%. High growth stocks are believed to be able to justify high P/E ratios. A stock is commonly considered to be undervalued when GPE is greater than 1.00 and overvalued when GPE is below 1.00. Unfortunately, this rule of thumb does not take into account the effect of interest rates on P/E ratios. The operative GPE ratio of 1.00 is valid when and only when interest rates equal 10%. With long-term interest rates currently at 3.49%, the operative GPE ratio is 0.121801. Therefore, CAT may be considered to be undervalued .
