Common Stock Valuation Ratios (Price Multiples)
Valuation ratios measure the quantity of an asset or flaw (e.g., earnings) associated with ownership of a specified claim (e.g., a share of ownership of the enterprise).
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Caterpillar Inc. pages available for free this week:
- Common-Size Balance Sheet: Liabilities and Stockholders’ Equity
- Analysis of Profitability Ratios
- Analysis of Solvency Ratios
- Analysis of Long-term (Investment) Activity Ratios
- DuPont Analysis: Disaggregation of ROE, ROA, and Net Profit Margin
- Current Ratio since 2005
- Price to Earnings (P/E) since 2005
- Price to Operating Profit (P/OP) since 2005
- Price to Sales (P/S) since 2005
- Analysis of Debt
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Current Valuation Ratios
Caterpillar Inc., current price multiples
| Caterpillar Inc. | Boeing Co. | Eaton Corp. plc | GE Aerospace | Honeywell International Inc. | Lockheed Martin Corp. | RTX Corp. | Capital Goods | Industrials | ||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data | ||||||||||||
| Current share price (P) | ||||||||||||
| No. shares of common stock outstanding | ||||||||||||
| Growth rate (g) | ||||||||||||
| Earnings per share (EPS) | ||||||||||||
| Next year expected EPS | ||||||||||||
| Operating profit per share | ||||||||||||
| Sales per share | ||||||||||||
| Book value per share (BVPS) | ||||||||||||
| Valuation Ratios (Price Multiples) | ||||||||||||
| Price to earnings (P/E) | ||||||||||||
| Price to next year expected earnings | ||||||||||||
| Price-earnings-growth (PEG) | ||||||||||||
| Price to operating profit (P/OP) | ||||||||||||
| Price to sales (P/S) | ||||||||||||
| Price to book value (P/BV) | ||||||||||||
Based on: 10-K (reporting date: 2025-12-31).
If the company price multiple is lower then the price multiple of benchmark then company stock is relatively undervalued.
Otherwise, if the company price multiple is higher then the price multiple of benchmark then company stock is relatively overvalued.
Historical Valuation Ratios (Summary)
Caterpillar Inc., historical price multiples
| Dec 31, 2025 | Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | ||
|---|---|---|---|---|---|---|
| Price to earnings (P/E) | ||||||
| Price to operating profit (P/OP) | ||||||
| Price to sales (P/S) | ||||||
| Price to book value (P/BV) |
Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
The valuation ratios exhibit generally increasing trends from 2021 through 2025, with a notable acceleration in the final year. A consistent pattern of relatively modest increases is observed in the earlier period, followed by a significant jump in the most recent year presented.
- Price to Earnings (P/E)
- The Price to Earnings ratio demonstrates an initial increase from 16.82 in 2021 to 19.15 in 2022, followed by a decrease to 15.55 in 2023 and a slight increase to 15.65 in 2024. A substantial increase is then observed in 2025, reaching 40.55. This suggests a considerable shift in investor expectations regarding future earnings potential in the latest year.
- Price to Operating Profit (P/OP)
- The Price to Operating Profit ratio follows a similar pattern to the P/E ratio. It increases from 15.87 in 2021 to 16.25 in 2022, decreases to 12.40 in 2023, and slightly increases to 12.92 in 2024. A significant increase to 32.30 is then recorded in 2025, mirroring the trend observed in the P/E ratio and indicating a heightened valuation relative to operating profitability.
- Price to Sales (P/S)
- The Price to Sales ratio shows a steady increase throughout the period. Starting at 2.26 in 2021, it rises to 2.27 in 2022, 2.52 in 2023, and 2.75 in 2024. The most substantial increase occurs in 2025, reaching 5.63. This indicates a growing willingness of investors to pay a premium for each dollar of revenue generated.
- Price to Book Value (P/BV)
- The Price to Book Value ratio also exhibits an increasing trend. It rises from 6.62 in 2021 to 8.09 in 2022, 8.25 in 2023, and 8.66 in 2024. A marked increase is observed in 2025, reaching 16.90. This suggests that the market is placing a significantly higher value on the company’s net assets in the final year.
Collectively, these ratios suggest a substantial re-evaluation of the company’s worth between 2024 and 2025. The increases across all observed multiples indicate a potentially optimistic outlook or a shift in market sentiment towards the company.
Price to Earnings (P/E)
Caterpillar Inc., historical P/E calculation, comparison to benchmarks
| Dec 31, 2025 | Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | ||
|---|---|---|---|---|---|---|
| No. shares of common stock outstanding1 | ||||||
| Selected Financial Data (US$) | ||||||
| Profit attributable to common stockholders (in millions) | ||||||
| Earnings per share (EPS)2 | ||||||
| Share price1, 3 | ||||||
| Valuation Ratio | ||||||
| P/E ratio4 | ||||||
| Benchmarks | ||||||
| P/E Ratio, Competitors5 | ||||||
| Boeing Co. | ||||||
| Eaton Corp. plc | ||||||
| GE Aerospace | ||||||
| Honeywell International Inc. | ||||||
| Lockheed Martin Corp. | ||||||
| RTX Corp. | ||||||
| P/E Ratio, Sector | ||||||
| Capital Goods | ||||||
| P/E Ratio, Industry | ||||||
| Industrials | ||||||
Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
1 Data adjusted for splits and stock dividends.
2 2025 Calculation
EPS = Profit attributable to common stockholders ÷ No. shares of common stock outstanding
= ÷ =
3 Closing price as at the filing date of Caterpillar Inc. Annual Report.
4 2025 Calculation
P/E ratio = Share price ÷ EPS
= ÷ =
5 Click competitor name to see calculations.
The price to earnings (P/E) ratio exhibited fluctuating behavior over the five-year period. Initial values indicated a moderate valuation, followed by a significant increase in the final year of the observed period.
- Overall Trend
- The P/E ratio demonstrated an initial increase from 2021 to 2022, followed by a decrease in 2023 and relative stability in 2024. A substantial increase is then observed in 2025.
- Initial Phase (2021-2023)
- From December 31, 2021, to December 31, 2023, the P/E ratio increased from 16.82 to 19.15, then decreased to 15.55. This suggests a period of shifting investor sentiment, potentially reflecting changing expectations regarding future earnings growth or risk assessment.
- Stabilization (2023-2024)
- The P/E ratio remained relatively stable between December 31, 2023, and December 31, 2024, at 15.55 and 15.65 respectively. This indicates a period of consolidation in valuation, with limited change in investor perception.
- Significant Increase (2024-2025)
- A marked increase in the P/E ratio occurred between December 31, 2024, and December 31, 2025, rising from 15.65 to 40.55. This substantial change suggests a significant shift in market expectations, potentially driven by anticipated future growth, a change in risk profile, or broader market conditions. The increase is disproportionately larger than the changes observed in prior periods.
- Relationship to Earnings Per Share
- While the share price increased consistently from 2021 to 2025, the earnings per share (EPS) also increased, but not at the same rate as the share price in the final year. The substantial increase in the P/E ratio in 2025 is attributable to a combination of a significant increase in share price and a slower growth rate in EPS.
The observed fluctuations in the P/E ratio warrant further investigation to determine the underlying drivers of these changes and their implications for valuation.
Price to Operating Profit (P/OP)
Caterpillar Inc., historical P/OP calculation, comparison to benchmarks
| Dec 31, 2025 | Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | ||
|---|---|---|---|---|---|---|
| No. shares of common stock outstanding1 | ||||||
| Selected Financial Data (US$) | ||||||
| Operating profit (in millions) | ||||||
| Operating profit per share2 | ||||||
| Share price1, 3 | ||||||
| Valuation Ratio | ||||||
| P/OP ratio4 | ||||||
| Benchmarks | ||||||
| P/OP Ratio, Competitors5 | ||||||
| Boeing Co. | ||||||
| Eaton Corp. plc | ||||||
| GE Aerospace | ||||||
| Honeywell International Inc. | ||||||
| Lockheed Martin Corp. | ||||||
| RTX Corp. | ||||||
| P/OP Ratio, Sector | ||||||
| Capital Goods | ||||||
| P/OP Ratio, Industry | ||||||
| Industrials | ||||||
Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
1 Data adjusted for splits and stock dividends.
2 2025 Calculation
Operating profit per share = Operating profit ÷ No. shares of common stock outstanding
= ÷ =
3 Closing price as at the filing date of Caterpillar Inc. Annual Report.
4 2025 Calculation
P/OP ratio = Share price ÷ Operating profit per share
= ÷ =
5 Click competitor name to see calculations.
The Price to Operating Profit (P/OP) ratio exhibited fluctuating behavior over the five-year period. Initially, the ratio demonstrated an increase followed by a decrease, and then a substantial rise in the final year examined.
- Overall Trend
- From 2021 to 2023, the P/OP ratio generally decreased. However, a significant increase is observed from 2023 to 2025, indicating a substantial shift in market valuation relative to operating profit.
- 2021-2022
- The P/OP ratio increased modestly from 15.87 in 2021 to 16.25 in 2022. This suggests a slight increase in the price investors were willing to pay for each dollar of operating profit during this period.
- 2022-2023
- A notable decrease in the P/OP ratio occurred between 2022 and 2023, falling from 16.25 to 12.40. This indicates that the share price did not increase as rapidly as operating profit per share, or potentially that operating profit per share increased while the share price remained relatively stable or decreased.
- 2023-2024
- The P/OP ratio experienced a slight increase from 12.40 in 2023 to 12.92 in 2024. This suggests a minor re-evaluation by the market, with investors willing to pay a slightly higher premium for operating profit.
- 2024-2025
- A dramatic increase in the P/OP ratio is evident from 2024 to 2025, rising from 12.92 to 32.30. This substantial change suggests a significant increase in investor confidence or expectations regarding future operating profitability, or a rapid increase in the share price relative to operating profit.
The operating profit per share generally increased from 2021 to 2024, before decreasing slightly in 2025. However, the share price experienced a much more pronounced increase, particularly in 2025, driving the significant change in the P/OP ratio.
Price to Sales (P/S)
Caterpillar Inc., historical P/S calculation, comparison to benchmarks
| Dec 31, 2025 | Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | ||
|---|---|---|---|---|---|---|
| No. shares of common stock outstanding1 | ||||||
| Selected Financial Data (US$) | ||||||
| Sales of Machinery, Power & Energy (in millions) | ||||||
| Sales per share2 | ||||||
| Share price1, 3 | ||||||
| Valuation Ratio | ||||||
| P/S ratio4 | ||||||
| Benchmarks | ||||||
| P/S Ratio, Competitors5 | ||||||
| Boeing Co. | ||||||
| Eaton Corp. plc | ||||||
| GE Aerospace | ||||||
| Honeywell International Inc. | ||||||
| Lockheed Martin Corp. | ||||||
| RTX Corp. | ||||||
| P/S Ratio, Sector | ||||||
| Capital Goods | ||||||
| P/S Ratio, Industry | ||||||
| Industrials | ||||||
Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
1 Data adjusted for splits and stock dividends.
2 2025 Calculation
Sales per share = Sales of Machinery, Power & Energy ÷ No. shares of common stock outstanding
= ÷ =
3 Closing price as at the filing date of Caterpillar Inc. Annual Report.
4 2025 Calculation
P/S ratio = Share price ÷ Sales per share
= ÷ =
5 Click competitor name to see calculations.
The Price to Sales (P/S) ratio exhibited an increasing trend over the five-year period. Initially, the ratio demonstrated relative stability, followed by a significant surge in later years. This analysis details the observed patterns and potential implications.
- Overall Trend
- The P/S ratio increased from 2.26 in 2021 to 5.63 in 2025. The most substantial increase occurred between 2024 and 2025, indicating a marked shift in market valuation relative to sales.
- Initial Stability (2021-2022)
- From 2021 to 2022, the P/S ratio remained relatively consistent, fluctuating between 2.26 and 2.27. This suggests a period of stable market perception regarding the company’s valuation in relation to its sales performance.
- Gradual Increase (2022-2024)
- A gradual upward trend was observed from 2022 to 2024, with the P/S ratio increasing from 2.27 to 2.75. This indicates a growing investor willingness to pay a premium for each dollar of sales generated by the company during this period.
- Significant Surge (2024-2025)
- The period between 2024 and 2025 witnessed a substantial increase in the P/S ratio, rising from 2.75 to 5.63. This represents a more than doubling of the ratio within a single year, potentially reflecting heightened market expectations regarding future sales growth, improved profitability, or a reassessment of the company’s overall value proposition.
- Share Price and Sales per Share Correlation
- The increase in the P/S ratio correlates with both the increase in share price and sales per share. While sales per share increased steadily, the share price experienced a particularly dramatic increase in 2025, contributing significantly to the elevated P/S ratio.
In conclusion, the P/S ratio demonstrates a clear upward trajectory, culminating in a significant increase in the most recent year. This trend warrants further investigation to determine the underlying drivers and assess the sustainability of this valuation level.
Price to Book Value (P/BV)
Caterpillar Inc., historical P/BV calculation, comparison to benchmarks
| Dec 31, 2025 | Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | ||
|---|---|---|---|---|---|---|
| No. shares of common stock outstanding1 | ||||||
| Selected Financial Data (US$) | ||||||
| Equity attributable to common shareholders (in millions) | ||||||
| Book value per share (BVPS)2 | ||||||
| Share price1, 3 | ||||||
| Valuation Ratio | ||||||
| P/BV ratio4 | ||||||
| Benchmarks | ||||||
| P/BV Ratio, Competitors5 | ||||||
| Boeing Co. | ||||||
| Eaton Corp. plc | ||||||
| GE Aerospace | ||||||
| Honeywell International Inc. | ||||||
| Lockheed Martin Corp. | ||||||
| RTX Corp. | ||||||
| P/BV Ratio, Sector | ||||||
| Capital Goods | ||||||
| P/BV Ratio, Industry | ||||||
| Industrials | ||||||
Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
1 Data adjusted for splits and stock dividends.
2 2025 Calculation
BVPS = Equity attributable to common shareholders ÷ No. shares of common stock outstanding
= ÷ =
3 Closing price as at the filing date of Caterpillar Inc. Annual Report.
4 2025 Calculation
P/BV ratio = Share price ÷ BVPS
= ÷ =
5 Click competitor name to see calculations.
The price to book value (P/BV) ratio exhibited an increasing trend over the five-year period. Initial values were relatively stable before a significant increase in the final year of the observed period.
- Price to Book Value (P/BV) Trend
- The P/BV ratio began at 6.62 in 2021 and increased to 8.09 in 2022. This upward movement continued, albeit at a slower pace, reaching 8.25 in 2023 and 8.66 in 2024. A substantial increase was then observed in 2025, with the P/BV ratio rising to 16.90.
The share price demonstrated a consistent increase throughout the period, with a particularly pronounced rise in 2025. This increase in share price contributed to the overall trend in the P/BV ratio.
- Share Price Movement
- The share price increased from US$203.64 in 2021 to US$248.70 in 2022, and then to US$321.91 in 2023. Further growth was seen in 2024, reaching US$353.32. The most significant increase occurred between 2024 and 2025, with the share price reaching US$774.20.
Book value per share (BVPS) also increased over the period, but at a more moderate rate than the share price. This difference in growth rates between share price and BVPS is a key driver of the observed P/BV trend.
- Book Value per Share (BVPS) Progression
- BVPS increased from US$30.76 in 2021 to US$30.73 in 2022, representing a slight decrease. It then rose to US$39.04 in 2023, US$40.78 in 2024, and finally to US$45.82 in 2025. The rate of increase in BVPS was consistently lower than the rate of increase in share price, particularly in 2025.
The substantial increase in the P/BV ratio in 2025 suggests that the market valuation of the company’s equity relative to its book value increased significantly during that year. This could be attributable to increased investor confidence, expectations of future growth, or other market factors.