Caterpillar Inc., FCFF calculation

US$ in millions

12 months ended:	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Profit attributable to common stockholders	10,335)	6,705)	6,489)	2,998)	6,093)
(Profit) loss attributable to noncontrolling interests	(3)	(1)	4)	5)	1)
Net noncash charges	2,402)	2,862)	1,352)	3,741)	3,748)
Changes in assets and liabilities, net of acquisitions and divestitures	151)	(1,800)	(647)	(417)	(2,930)
Net cash provided by operating activities	12,885)	7,766)	7,198)	6,327)	6,912)
Interest paid on short-term and long-term borrowings, net of tax¹	1,347)	733)	725)	815)	820)
Capital expenditures, excluding equipment leased to others	(1,597)	(1,296)	(1,093)	(978)	(1,056)
Expenditures for equipment leased to others	(1,495)	(1,303)	(1,379)	(1,137)	(1,613)
Proceeds from disposals of leased assets and property, plant and equipment	781)	830)	1,265)	772)	1,153)
Free cash flow to the firm (FCFF)	11,921)	6,730)	6,716)	5,799)	6,216)

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

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Item	Description	The company
FCFF	Free cash flow to the firm is the cash flow available to the Caterpillar Inc. suppliers of capital after all operating expenses have been paid and necessary investments in working and fixed capital have been made.	Caterpillar Inc. FCFF increased from 2021 to 2022 and from 2022 to 2023.

Caterpillar Inc., interest paid, net of tax calculation

US$ in millions

12 months ended:	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Effective Income Tax Rate (EITR)
EITR¹	21.30%	23.60%	21.20%	25.20%	22.40%
Interest Paid, Net of Tax
Interest paid on short-term and long-term borrowings, before tax	1,711)	959)	920)	1,089)	1,057)
Less: Interest paid on short-term and long-term borrowings, tax²	364)	226)	195)	274)	237)
Interest paid on short-term and long-term borrowings, net of tax	1,347)	733)	725)	815)	820)

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

¹ See details »

² 2023 Calculation
Interest paid on short-term and long-term borrowings, tax = Interest paid on short-term and long-term borrowings × EITR
= 1,711 × 21.30% = 364

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Caterpillar Inc., current EV/FCFF calculation, comparison to benchmarks

Selected Financial Data (US$ in millions)
Enterprise value (EV)	199,699)
Free cash flow to the firm (FCFF)	11,921)
Valuation Ratio
EV/FCFF	16.75
Benchmarks
EV/FCFF, Competitors¹
Boeing Co.	21.54
Cummins Inc.	15.78
Eaton Corp. plc	42.03
General Electric Co.	35.14
Honeywell International Inc.	28.53
Lockheed Martin Corp.	18.38
RTX Corp.	25.76
EV/FCFF, Sector
Capital Goods	23.62
EV/FCFF, Industry
Industrials	25.34

Based on: 10-K (reporting date: 2023-12-31).

¹ Click competitor name to see calculations.

If the company EV/FCFF is lower then the EV/FCFF of benchmark then company is relatively undervalued.
Otherwise, if the company EV/FCFF is higher then the EV/FCFF of benchmark then company is relatively overvalued.

Caterpillar Inc., historical EV/FCFF calculation, comparison to benchmarks

	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Selected Financial Data (US$ in millions)
Enterprise value (EV)¹	191,664)	158,426)	137,695)	138,173)	104,698)
Free cash flow to the firm (FCFF)²	11,921)	6,730)	6,716)	5,799)	6,216)
Valuation Ratio
EV/FCFF³	16.08	23.54	20.50	23.83	16.84
Benchmarks
EV/FCFF, Competitors⁴
Boeing Co.	25.63	37.53	—	—	—
Cummins Inc.	14.10	35.58	21.11	16.67	10.35
Eaton Corp. plc	38.49	33.44	38.16	21.94	15.50
General Electric Co.	29.56	17.29	56.53	32.34	15.85
Honeywell International Inc.	29.13	29.82	25.22	26.49	21.13
Lockheed Martin Corp.	17.62	19.69	13.92	14.64	21.21
RTX Corp.	23.86	28.45	27.29	35.26	21.94
EV/FCFF, Sector
Capital Goods	22.77	26.17	31.55	66.05	23.83
EV/FCFF, Industry
Industrials	25.15	25.09	28.18	65.99	30.06

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

¹ See details »

² See details »

³ 2023 Calculation
EV/FCFF = EV ÷ FCFF
= 191,664 ÷ 11,921 = 16.08

⁴ Click competitor name to see calculations.

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Valuation ratio	Description	The company
EV/FCFF	Enterprise value to free cash flow to the firm is whole company valuation indicator.	Caterpillar Inc. EV/FCFF ratio increased from 2021 to 2022 but then decreased significantly from 2022 to 2023.

Caterpillar Inc. (NYSE:CAT)

Enterprise Value to FCFF (EV/FCFF)

Free Cash Flow to The Firm (FCFF)

Interest Paid, Net of Tax

Enterprise Value to FCFF Ratio, Current

Enterprise Value to FCFF Ratio, Historical