Microsoft Excel LibreOffice Calc

Caterpillar Inc. (CAT)


Analysis of Solvency Ratios

Difficulty: Beginner


Solvency Ratios (Summary)

Caterpillar Inc., solvency ratios

Microsoft Excel LibreOffice Calc
Dec 31, 2018 Dec 31, 2017 Dec 31, 2016 Dec 31, 2015 Dec 31, 2014
Debt Ratios
Debt to equity 2.60 2.55 2.80 2.57 2.35
Debt to capital 0.72 0.72 0.74 0.72 0.70
Debt to assets 0.47 0.45 0.49 0.49 0.46
Financial leverage 5.59 5.62 5.69 5.30 5.06
Coverage Ratios
Interest coverage 20.42 8.72 1.26 6.63 11.52
Fixed charge coverage 11.81 5.75 1.15 4.25 6.82

Based on: 10-K (filing date: 2019-02-14), 10-K (filing date: 2018-02-15), 10-K (filing date: 2017-02-15), 10-K (filing date: 2016-02-16), 10-K (filing date: 2015-02-17).

Solvency ratio Description The company
Debt to equity ratio A solvency ratio calculated as total debt divided by total shareholders’ equity.
Debt to capital ratio A solvency ratio calculated as total debt divided by total debt plus shareholders’ equity.
Debt to assets ratio A solvency ratio calculated as total debt divided by total assets.
Financial leverage ratio A solvency ratio calculated as total assets divided by total shareholders’ equity. Caterpillar Inc.’s financial leverage ratio declined from 2016 to 2017 and from 2017 to 2018.

Solvency ratio Description The company
Interest coverage ratio A solvency ratio calculated as EBIT divided by interest payments. Caterpillar Inc.’s interest coverage ratio improved from 2016 to 2017 and from 2017 to 2018.
Fixed charge coverage ratio A solvency ratio calculated as earnings before fixed charges and tax divided by fixed charges. Caterpillar Inc.’s fixed charge coverage ratio improved from 2016 to 2017 and from 2017 to 2018.

Debt to Equity

Caterpillar Inc., debt to equity calculation, comparison to benchmarks

Microsoft Excel LibreOffice Calc
Dec 31, 2018 Dec 31, 2017 Dec 31, 2016 Dec 31, 2015 Dec 31, 2014
Selected Financial Data (US$ in millions)
Short-term borrowings 5,723  4,837  7,303  6,967  4,708 
Long-term debt due within one year 5,830  6,194  6,662  5,879  6,793 
Long-term debt due after one year 25,000  23,847  22,818  25,247  27,784 
Total debt 36,553  34,878  36,783  38,093  39,285 
 
Equity attributable to common stockholders 14,039  13,697  13,137  14,809  16,746 
Solvency Ratio
Debt to equity1 2.60 2.55 2.80 2.57 2.35
Benchmarks
Debt to Equity, Competitors2
Illinois Tool Works Inc. 2.27 1.82 1.84 1.42 1.09
Debt to Equity, Sector
Industrial Engineering 2.54 2.36 2.57 2.27 1.98
Debt to Equity, Industry
Industrials 1.51 1.36 1.31 1.30 1.50

Based on: 10-K (filing date: 2019-02-14), 10-K (filing date: 2018-02-15), 10-K (filing date: 2017-02-15), 10-K (filing date: 2016-02-16), 10-K (filing date: 2015-02-17).

1 2018 Calculation
Debt to equity = Total debt ÷ Equity attributable to common stockholders
= 36,553 ÷ 14,039 = 2.60

2 Click competitor name to see calculations.

Solvency ratio Description The company
Debt to equity ratio A solvency ratio calculated as total debt divided by total shareholders’ equity.

Debt to Capital

Caterpillar Inc., debt to capital calculation, comparison to benchmarks

Microsoft Excel LibreOffice Calc
Dec 31, 2018 Dec 31, 2017 Dec 31, 2016 Dec 31, 2015 Dec 31, 2014
Selected Financial Data (US$ in millions)
Short-term borrowings 5,723  4,837  7,303  6,967  4,708 
Long-term debt due within one year 5,830  6,194  6,662  5,879  6,793 
Long-term debt due after one year 25,000  23,847  22,818  25,247  27,784 
Total debt 36,553  34,878  36,783  38,093  39,285 
Equity attributable to common stockholders 14,039  13,697  13,137  14,809  16,746 
Total capital 50,592  48,575  49,920  52,902  56,031 
Solvency Ratio
Debt to capital1 0.72 0.72 0.74 0.72 0.70
Benchmarks
Debt to Capital, Competitors2
Illinois Tool Works Inc. 0.69 0.64 0.65 0.59 0.52
Debt to Capital, Sector
Industrial Engineering 0.72 0.70 0.72 0.69 0.66
Debt to Capital, Industry
Industrials 0.60 0.58 0.57 0.56 0.60

Based on: 10-K (filing date: 2019-02-14), 10-K (filing date: 2018-02-15), 10-K (filing date: 2017-02-15), 10-K (filing date: 2016-02-16), 10-K (filing date: 2015-02-17).

1 2018 Calculation
Debt to capital = Total debt ÷ Total capital
= 36,553 ÷ 50,592 = 0.72

2 Click competitor name to see calculations.

Solvency ratio Description The company
Debt to capital ratio A solvency ratio calculated as total debt divided by total debt plus shareholders’ equity.

Debt to Assets

Caterpillar Inc., debt to assets calculation, comparison to benchmarks

Microsoft Excel LibreOffice Calc
Dec 31, 2018 Dec 31, 2017 Dec 31, 2016 Dec 31, 2015 Dec 31, 2014
Selected Financial Data (US$ in millions)
Short-term borrowings 5,723  4,837  7,303  6,967  4,708 
Long-term debt due within one year 5,830  6,194  6,662  5,879  6,793 
Long-term debt due after one year 25,000  23,847  22,818  25,247  27,784 
Total debt 36,553  34,878  36,783  38,093  39,285 
 
Total assets 78,509  76,962  74,704  78,497  84,681 
Solvency Ratio
Debt to assets1 0.47 0.45 0.49 0.49 0.46
Benchmarks
Debt to Assets, Competitors2
Illinois Tool Works Inc. 0.50 0.50 0.52 0.47 0.42
Debt to Assets, Sector
Industrial Engineering 0.47 0.46 0.50 0.48 0.46
Debt to Assets, Industry
Industrials 0.31 0.31 0.30 0.31 0.37

Based on: 10-K (filing date: 2019-02-14), 10-K (filing date: 2018-02-15), 10-K (filing date: 2017-02-15), 10-K (filing date: 2016-02-16), 10-K (filing date: 2015-02-17).

1 2018 Calculation
Debt to assets = Total debt ÷ Total assets
= 36,553 ÷ 78,509 = 0.47

2 Click competitor name to see calculations.

Solvency ratio Description The company
Debt to assets ratio A solvency ratio calculated as total debt divided by total assets.

Financial Leverage

Caterpillar Inc., financial leverage calculation, comparison to benchmarks

Microsoft Excel LibreOffice Calc
Dec 31, 2018 Dec 31, 2017 Dec 31, 2016 Dec 31, 2015 Dec 31, 2014
Selected Financial Data (US$ in millions)
Total assets 78,509  76,962  74,704  78,497  84,681 
Equity attributable to common stockholders 14,039  13,697  13,137  14,809  16,746 
Solvency Ratio
Financial leverage1 5.59 5.62 5.69 5.30 5.06
Benchmarks
Financial Leverage, Competitors2
Illinois Tool Works Inc. 4.57 3.66 3.57 3.01 2.59
Financial Leverage, Sector
Industrial Engineering 5.40 5.13 5.17 4.70 4.34
Financial Leverage, Industry
Industrials 4.86 4.45 4.36 4.19 4.03

Based on: 10-K (filing date: 2019-02-14), 10-K (filing date: 2018-02-15), 10-K (filing date: 2017-02-15), 10-K (filing date: 2016-02-16), 10-K (filing date: 2015-02-17).

1 2018 Calculation
Financial leverage = Total assets ÷ Equity attributable to common stockholders
= 78,509 ÷ 14,039 = 5.59

2 Click competitor name to see calculations.

Solvency ratio Description The company
Financial leverage ratio A solvency ratio calculated as total assets divided by total shareholders’ equity. Caterpillar Inc.’s financial leverage ratio declined from 2016 to 2017 and from 2017 to 2018.

Interest Coverage

Caterpillar Inc., interest coverage calculation, comparison to benchmarks

Microsoft Excel LibreOffice Calc
Dec 31, 2018 Dec 31, 2017 Dec 31, 2016 Dec 31, 2015 Dec 31, 2014
Selected Financial Data (US$ in millions)
Profit (loss) attributable to common stockholders 6,147  754  (67) 2,102  3,695 
Add: Net income attributable to noncontrolling interest 11  16 
Add: Income tax expense 1,698  3,339  192  742  1,380 
Add: Interest expense excluding Financial Products 404  531  505  507  484 
Earnings before interest and tax (EBIT) 8,250  4,629  638  3,362  5,575 
Solvency Ratio
Interest coverage1 20.42 8.72 1.26 6.63 11.52
Benchmarks
Interest Coverage, Competitors2
Illinois Tool Works Inc. 14.21 13.58 13.27 13.03 11.80
Interest Coverage, Sector
Industrial Engineering 18.00 10.31 5.10 8.60 11.61
Interest Coverage, Industry
Industrials 7.01 7.95 8.24 10.83 7.76

Based on: 10-K (filing date: 2019-02-14), 10-K (filing date: 2018-02-15), 10-K (filing date: 2017-02-15), 10-K (filing date: 2016-02-16), 10-K (filing date: 2015-02-17).

1 2018 Calculation
Interest coverage = EBIT ÷ Interest expense
= 8,250 ÷ 404 = 20.42

2 Click competitor name to see calculations.

Solvency ratio Description The company
Interest coverage ratio A solvency ratio calculated as EBIT divided by interest payments. Caterpillar Inc.’s interest coverage ratio improved from 2016 to 2017 and from 2017 to 2018.

Fixed Charge Coverage

Caterpillar Inc., fixed charge coverage calculation, comparison to benchmarks

Microsoft Excel LibreOffice Calc
Dec 31, 2018 Dec 31, 2017 Dec 31, 2016 Dec 31, 2015 Dec 31, 2014
Selected Financial Data (US$ in millions)
Profit (loss) attributable to common stockholders 6,147  754  (67) 2,102  3,695 
Add: Net income attributable to noncontrolling interest 11  16 
Add: Income tax expense 1,698  3,339  192  742  1,380 
Add: Interest expense excluding Financial Products 404  531  505  507  484 
Earnings before interest and tax (EBIT) 8,250  4,629  638  3,362  5,575 
Add: Rental expense for operating leases 322  331  375  371  391 
Earnings before fixed charges and tax 8,572  4,960  1,013  3,733  5,966 
 
Interest expense excluding Financial Products 404  531  505  507  484 
Rental expense for operating leases 322  331  375  371  391 
Fixed charges 726  862  880  878  875 
Solvency Ratio
Fixed charge coverage1 11.81 5.75 1.15 4.25 6.82
Benchmarks
Fixed Charge Coverage, Competitors2
Illinois Tool Works Inc. 9.91 9.61 9.12 8.93 8.10
Fixed Charge Coverage, Sector
Industrial Engineering 11.15 6.93 3.46 5.57 7.21
Fixed Charge Coverage, Industry
Industrials 4.19 4.60 4.79 5.89 5.14

Based on: 10-K (filing date: 2019-02-14), 10-K (filing date: 2018-02-15), 10-K (filing date: 2017-02-15), 10-K (filing date: 2016-02-16), 10-K (filing date: 2015-02-17).

1 2018 Calculation
Fixed charge coverage = Earnings before fixed charges and tax ÷ Fixed charges
= 8,572 ÷ 726 = 11.81

2 Click competitor name to see calculations.

Solvency ratio Description The company
Fixed charge coverage ratio A solvency ratio calculated as earnings before fixed charges and tax divided by fixed charges. Caterpillar Inc.’s fixed charge coverage ratio improved from 2016 to 2017 and from 2017 to 2018.