Analysis of Profitability Ratios
Profitability ratios measure the company ability to generate profitable sales from its resources (assets).
Profitability Ratios (Summary)
Caterpillar Inc., profitability ratios
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
| Profitability ratio | Description | The company |
|---|---|---|
| Gross profit margin | Gross profit margin indicates the percentage of revenue available to cover operating and other expenditures. | Caterpillar Inc. gross profit margin ratio deteriorated from 2019 to 2020 but then slightly improved from 2020 to 2021. |
| Operating profit margin | A profitability ratio calculated as operating income divided by revenue. | Caterpillar Inc. operating profit margin ratio deteriorated from 2019 to 2020 but then improved from 2020 to 2021 not reaching 2019 level. |
| Net profit margin | An indicator of profitability, calculated as net income divided by revenue. | Caterpillar Inc. net profit margin ratio deteriorated from 2019 to 2020 but then improved from 2020 to 2021 exceeding 2019 level. |
| Profitability ratio | Description | The company |
|---|---|---|
| ROE | A profitability ratio calculated as net income divided by shareholders’ equity. | Caterpillar Inc. ROE deteriorated from 2019 to 2020 but then improved from 2020 to 2021 not reaching 2019 level. |
| ROA | A profitability ratio calculated as net income divided by total assets. | Caterpillar Inc. ROA deteriorated from 2019 to 2020 but then improved from 2020 to 2021 exceeding 2019 level. |
Gross Profit Margin
Caterpillar Inc., gross profit margin calculation, comparison to benchmarks
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Gross margin | 12,675) | 9,940) | 14,125) | 14,825) | 11,627) | |
| Sales of Machinery, Energy & Transportation | 48,188) | 39,022) | 50,755) | 51,822) | 42,676) | |
| Profitability Ratio | ||||||
| Gross profit margin1 | 26.30% | 25.47% | 27.83% | 28.61% | 27.24% | |
| Benchmarks | ||||||
| Gross Profit Margin, Competitors2 | ||||||
| Boeing Co. | 4.84% | -9.78% | 5.83% | 19.42% | — | |
| General Electric Co. | 24.19% | 17.26% | 23.52% | 18.38% | 18.78% | |
| Honeywell International Inc. | 31.98% | 32.07% | 33.70% | 30.52% | 31.97% | |
| Lockheed Martin Corp. | 13.52% | 13.23% | 13.99% | 13.53% | — | |
| Northrop Grumman Corp. | 20.38% | 20.32% | 21.45% | 22.57% | — | |
| Raytheon Technologies Corp. | 19.40% | 15.08% | 25.93% | 24.84% | — | |
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
1 2021 Calculation
Gross profit margin = 100 × Gross margin ÷ Sales of Machinery, Energy & Transportation
= 100 × 12,675 ÷ 48,188 = 26.30%
2 Click competitor name to see calculations.
| Profitability ratio | Description | The company |
|---|---|---|
| Gross profit margin | Gross profit margin indicates the percentage of revenue available to cover operating and other expenditures. | Caterpillar Inc. gross profit margin ratio deteriorated from 2019 to 2020 but then slightly improved from 2020 to 2021. |
Operating Profit Margin
Caterpillar Inc., operating profit margin calculation, comparison to benchmarks
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Operating profit | 6,878) | 4,553) | 8,290) | 8,293) | 4,406) | |
| Sales of Machinery, Energy & Transportation | 48,188) | 39,022) | 50,755) | 51,822) | 42,676) | |
| Profitability Ratio | ||||||
| Operating profit margin1 | 14.27% | 11.67% | 16.33% | 16.00% | 10.32% | |
| Benchmarks | ||||||
| Operating Profit Margin, Competitors2 | ||||||
| Boeing Co. | -4.66% | -21.95% | -2.58% | 11.85% | — | |
| General Electric Co. | 8.58% | 5.49% | 12.84% | 9.54% | 9.06% | |
| Honeywell International Inc. | 18.03% | 17.45% | 18.66% | 16.04% | 17.64% | |
| Lockheed Martin Corp. | 13.61% | 13.22% | 14.29% | 13.64% | — | |
| Northrop Grumman Corp. | 15.84% | 11.05% | 11.73% | 12.56% | — | |
| Raytheon Technologies Corp. | 7.70% | -3.34% | 11.64% | 12.86% | — | |
| Operating Profit Margin, Sector | ||||||
| Capital Goods | 9.40% | 3.41% | 10.87% | 12.53% | — | |
| Operating Profit Margin, Industry | ||||||
| Industrials | 10.34% | 3.08% | 11.48% | 12.37% | — | |
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
1 2021 Calculation
Operating profit margin = 100 × Operating profit ÷ Sales of Machinery, Energy & Transportation
= 100 × 6,878 ÷ 48,188 = 14.27%
2 Click competitor name to see calculations.
| Profitability ratio | Description | The company |
|---|---|---|
| Operating profit margin | A profitability ratio calculated as operating income divided by revenue. | Caterpillar Inc. operating profit margin ratio deteriorated from 2019 to 2020 but then improved from 2020 to 2021 not reaching 2019 level. |
Net Profit Margin
Caterpillar Inc., net profit margin calculation, comparison to benchmarks
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Profit attributable to common stockholders | 6,489) | 2,998) | 6,093) | 6,147) | 754) | |
| Sales of Machinery, Energy & Transportation | 48,188) | 39,022) | 50,755) | 51,822) | 42,676) | |
| Profitability Ratio | ||||||
| Net profit margin1 | 13.47% | 7.68% | 12.00% | 11.86% | 1.77% | |
| Benchmarks | ||||||
| Net Profit Margin, Competitors2 | ||||||
| Boeing Co. | -6.75% | -20.42% | -0.83% | 10.34% | — | |
| General Electric Co. | -9.17% | 7.81% | -5.69% | -19.69% | -5.11% | |
| Honeywell International Inc. | 16.11% | 14.64% | 16.73% | 16.18% | 4.08% | |
| Lockheed Martin Corp. | 9.42% | 10.45% | 10.42% | 9.39% | — | |
| Northrop Grumman Corp. | 19.64% | 8.67% | 6.64% | 10.73% | — | |
| Raytheon Technologies Corp. | 6.00% | -6.22% | 7.19% | 7.92% | — | |
| Net Profit Margin, Sector | ||||||
| Capital Goods | 4.83% | 2.24% | 4.89% | 3.17% | — | |
| Net Profit Margin, Industry | ||||||
| Industrials | 6.58% | 0.50% | 5.74% | 5.12% | — | |
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
1 2021 Calculation
Net profit margin = 100 × Profit attributable to common stockholders ÷ Sales of Machinery, Energy & Transportation
= 100 × 6,489 ÷ 48,188 = 13.47%
2 Click competitor name to see calculations.
| Profitability ratio | Description | The company |
|---|---|---|
| Net profit margin | An indicator of profitability, calculated as net income divided by revenue. | Caterpillar Inc. net profit margin ratio deteriorated from 2019 to 2020 but then improved from 2020 to 2021 exceeding 2019 level. |
Return on Equity (ROE)
Caterpillar Inc., ROE calculation, comparison to benchmarks
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Profit attributable to common stockholders | 6,489) | 2,998) | 6,093) | 6,147) | 754) | |
| Equity attributable to common shareholders | 16,484) | 15,331) | 14,588) | 14,039) | 13,697) | |
| Profitability Ratio | ||||||
| ROE1 | 39.37% | 19.56% | 41.77% | 43.79% | 5.50% | |
| Benchmarks | ||||||
| ROE, Competitors2 | ||||||
| Boeing Co. | — | — | — | 3,085.55% | — | |
| General Electric Co. | -16.17% | 16.04% | -17.58% | -72.16% | -9.00% | |
| Honeywell International Inc. | 29.85% | 27.23% | 33.22% | 37.21% | 9.58% | |
| Lockheed Martin Corp. | 57.62% | 113.60% | 199.23% | 361.98% | — | |
| Northrop Grumman Corp. | 54.19% | 30.14% | 25.49% | 39.44% | — | |
| Raytheon Technologies Corp. | 5.29% | -4.88% | 13.25% | 13.70% | — | |
| ROE, Sector | ||||||
| Capital Goods | 11.76% | 5.84% | 19.38% | 13.05% | — | |
| ROE, Industry | ||||||
| Industrials | 19.43% | 1.55% | 23.42% | 20.78% | — | |
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
1 2021 Calculation
ROE = 100 × Profit attributable to common stockholders ÷ Equity attributable to common shareholders
= 100 × 6,489 ÷ 16,484 = 39.37%
2 Click competitor name to see calculations.
| Profitability ratio | Description | The company |
|---|---|---|
| ROE | A profitability ratio calculated as net income divided by shareholders’ equity. | Caterpillar Inc. ROE deteriorated from 2019 to 2020 but then improved from 2020 to 2021 not reaching 2019 level. |
Return on Assets (ROA)
Caterpillar Inc., ROA calculation, comparison to benchmarks
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Profit attributable to common stockholders | 6,489) | 2,998) | 6,093) | 6,147) | 754) | |
| Total assets | 82,793) | 78,324) | 78,453) | 78,509) | 76,962) | |
| Profitability Ratio | ||||||
| ROA1 | 7.84% | 3.83% | 7.77% | 7.83% | 0.98% | |
| Benchmarks | ||||||
| ROA, Competitors2 | ||||||
| Boeing Co. | -3.03% | -7.80% | -0.48% | 8.91% | — | |
| General Electric Co. | -3.28% | 2.25% | -1.87% | -7.23% | -1.53% | |
| Honeywell International Inc. | 8.60% | 7.40% | 10.47% | 11.71% | 2.79% | |
| Lockheed Martin Corp. | 12.41% | 13.47% | 13.11% | 11.24% | — | |
| Northrop Grumman Corp. | 16.45% | 7.17% | 5.47% | 8.58% | — | |
| Raytheon Technologies Corp. | 2.39% | -2.17% | 3.96% | 3.93% | — | |
| ROA, Sector | ||||||
| Capital Goods | 2.50% | 1.01% | 2.70% | 1.87% | — | |
| ROA, Industry | ||||||
| Industrials | 3.80% | 0.25% | 3.63% | 3.39% | — | |
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
1 2021 Calculation
ROA = 100 × Profit attributable to common stockholders ÷ Total assets
= 100 × 6,489 ÷ 82,793 = 7.84%
2 Click competitor name to see calculations.
| Profitability ratio | Description | The company |
|---|---|---|
| ROA | A profitability ratio calculated as net income divided by total assets. | Caterpillar Inc. ROA deteriorated from 2019 to 2020 but then improved from 2020 to 2021 exceeding 2019 level. |