Caterpillar Inc. (CAT)
Analysis of Profitability Ratios
Beginner level
Profitability ratios measure the company’s ability to generate profitable sales from its resources (assets).
Profitability Ratios (Summary)
Caterpillar Inc., profitability ratios
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).
| 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.’s gross profit margin ratio improved from 2016 to 2017 and from 2017 to 2018. |
| Operating profit margin | A profitability ratio calculated as operating income divided by revenue. | Caterpillar Inc.’s operating profit margin ratio improved from 2016 to 2017 and from 2017 to 2018. |
| Net profit margin | An indicator of profitability, calculated as net income divided by revenue. | Caterpillar Inc.’s net profit margin ratio improved from 2016 to 2017 and from 2017 to 2018. |
| Profitability ratio | Description | The company |
|---|---|---|
| ROE | A profitability ratio calculated as net income divided by shareholders’ equity. | Caterpillar Inc.’s ROE improved from 2016 to 2017 and from 2017 to 2018. |
| ROA | A profitability ratio calculated as net income divided by total assets. | Caterpillar Inc.’s ROA improved from 2016 to 2017 and from 2017 to 2018. |
Gross Profit Margin
Caterpillar Inc., gross profit margin calculation, comparison to benchmarks
| Dec 31, 2018 | Dec 31, 2017 | Dec 31, 2016 | Dec 31, 2015 | Dec 31, 2014 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Gross margin | 14,825 | 11,627 | 7,464 | 10,405 | 12,375 | |
| Sales of Machinery, Energy & Transportation | 51,822 | 42,676 | 35,773 | 44,147 | 52,142 | |
| Profitability Ratio | ||||||
| Gross profit margin1 | 28.61% | 27.24% | 20.86% | 23.57% | 23.73% | |
| Benchmarks | ||||||
| Gross Profit Margin, Competitors2 | ||||||
| Illinois Tool Works Inc. | 41.74% | 41.95% | 41.94% | 41.16% | 40.12% | |
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
Gross profit margin = 100 × Gross margin ÷ Sales of Machinery, Energy & Transportation
= 100 × 14,825 ÷ 51,822 = 28.61%
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.’s gross profit margin ratio improved from 2016 to 2017 and from 2017 to 2018. |
Operating Profit Margin
Caterpillar Inc., operating profit margin calculation, comparison to benchmarks
| Dec 31, 2018 | Dec 31, 2017 | Dec 31, 2016 | Dec 31, 2015 | Dec 31, 2014 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Operating profit | 8,293 | 4,406 | 498 | 3,256 | 5,328 | |
| Sales of Machinery, Energy & Transportation | 51,822 | 42,676 | 35,773 | 44,147 | 52,142 | |
| Profitability Ratio | ||||||
| Operating profit margin1 | 16.00% | 10.32% | 1.39% | 7.38% | 10.22% | |
| Benchmarks | ||||||
| Operating Profit Margin, Competitors2 | ||||||
| Illinois Tool Works Inc. | 24.27% | 24.41% | 22.53% | 21.39% | 19.94% | |
| Operating Profit Margin, Sector | ||||||
| Industrial Engineering | 17.84% | 13.86% | 7.21% | 10.64% | — | |
| Operating Profit Margin, Industry | ||||||
| Industrials | 14.04% | 13.70% | 12.78% | 13.66% | — | |
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
Operating profit margin = 100 × Operating profit ÷ Sales of Machinery, Energy & Transportation
= 100 × 8,293 ÷ 51,822 = 16.00%
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.’s operating profit margin ratio improved from 2016 to 2017 and from 2017 to 2018. |
Net Profit Margin
Caterpillar Inc., net profit margin calculation, comparison to benchmarks
| 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 | |
| Sales of Machinery, Energy & Transportation | 51,822 | 42,676 | 35,773 | 44,147 | 52,142 | |
| Profitability Ratio | ||||||
| Net profit margin1 | 11.86% | 1.77% | -0.19% | 4.76% | 7.09% | |
| Benchmarks | ||||||
| Net Profit Margin, Competitors2 | ||||||
| Illinois Tool Works Inc. | 17.36% | 11.79% | 14.96% | 14.17% | 20.34% | |
| Net Profit Margin, Sector | ||||||
| Industrial Engineering | 13.08% | 4.28% | 3.99% | 6.95% | — | |
| Net Profit Margin, Industry | ||||||
| Industrials | 6.94% | 7.55% | 8.82% | 7.36% | — | |
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
Net profit margin = 100 × Profit (loss) attributable to common stockholders ÷ Sales of Machinery, Energy & Transportation
= 100 × 6,147 ÷ 51,822 = 11.86%
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.’s net profit margin ratio improved from 2016 to 2017 and from 2017 to 2018. |
Return on Equity (ROE)
Caterpillar Inc., ROE calculation, comparison to benchmarks
| 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 | |
| Equity attributable to common stockholders | 14,039 | 13,697 | 13,137 | 14,809 | 16,746 | |
| Profitability Ratio | ||||||
| ROE1 | 43.79% | 5.50% | -0.51% | 14.19% | 22.06% | |
| Benchmarks | ||||||
| ROE, Competitors2 | ||||||
| Illinois Tool Works Inc. | 78.76% | 36.79% | 47.84% | 36.35% | 43.20% | |
| ROE, Sector | ||||||
| Industrial Engineering | 50.37% | 13.35% | 11.32% | 19.97% | — | |
| ROE, Industry | ||||||
| Industrials | 22.77% | 21.24% | 24.02% | 17.80% | — | |
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
ROE = 100 × Profit (loss) attributable to common stockholders ÷ Equity attributable to common stockholders
= 100 × 6,147 ÷ 14,039 = 43.79%
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.’s ROE improved from 2016 to 2017 and from 2017 to 2018. |
Return on Assets (ROA)
Caterpillar Inc., ROA calculation, comparison to benchmarks
| 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 | |
| Total assets | 78,509 | 76,962 | 74,704 | 78,497 | 84,681 | |
| Profitability Ratio | ||||||
| ROA1 | 7.83% | 0.98% | -0.09% | 2.68% | 4.36% | |
| Benchmarks | ||||||
| ROA, Competitors2 | ||||||
| Illinois Tool Works Inc. | 17.24% | 10.05% | 13.39% | 12.07% | 16.66% | |
| ROA, Sector | ||||||
| Industrial Engineering | 9.33% | 2.60% | 2.19% | 4.25% | — | |
| ROA, Industry | ||||||
| Industrials | 4.68% | 4.77% | 5.51% | 4.25% | — | |
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
ROA = 100 × Profit (loss) attributable to common stockholders ÷ Total assets
= 100 × 6,147 ÷ 78,509 = 7.83%
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.’s ROA improved from 2016 to 2017 and from 2017 to 2018. |