CAT US S&P 500DJIARussell 1000 Earnings call · transcribed from the recording
Caterpillar Inc. (CAT) · Q3 2026 results and valuation
Share price: $601.61 · 2026-11-11
Caterpillar Inc. manufactures construction and mining equipment, off-highway diesel and natural gas engines, industrial gas turbines, and diesel-electric locomotives. The company serves customers in the construction, mining, power, and energy industries across global markets. It provides machinery, components, and related services for infrastructure, mining, and industrial applications. Source: 10-K annual report (2026-02-13)
Results Q3 2026 vs Q2 2026 · previous quarter · published 29 Oct 2026 and 4 Aug 2026
Net income down 8.5% on the previous quarter. Management sounded very upbeat, though noticeably less so answering analysts.
Only a basic analysis is available for this company at the moment.
1 · Numbers
−8.5%
Net income vs Q2 2026
Outlook given
Net income 3.29B vs 3.59B
Revenue +0.7%
2 · How management spoke
Very upbeat
More upbeat than 90% of company calls
Answers to analysts: typical, but clearly less so than the script.
Last call it was different: the answers were more upbeat than the script.
3 · What stood out
Key theme
Excluding IEPA tariff recoveries, adjusted operating profit margin was in line with Caterpillar's expectations.
Valuation
Is Caterpillar Inc. undervalued?
Reverse DCF. Free cash flow from the last full fiscal year (2025-12-31), grown for 10 years, discounted back, plus a terminal value. “Implied growth” is the rate the current price assumes.
At 4.4% growth a year (3-year revenue growth), the model's fair value is $240.70 a share — the stock trades 150% above it. Today's price assumes 15.0% growth a year.
Current price
$601.61
close of 2026-11-11
Market implies growth of iThe yearly free-cash-flow growth, for the next 10 years, that today’s share price already assumes. If you believe the company grows faster than this, the stock is cheap under this model; slower, and it is expensive.
+15.0% for 10 yrs
Fair value / share
$240.70
Buy below
$180.52
Price vs fair value
Overvalued 150%
Price vs buy-below price
Overvalued >200%
Read between the lines
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Figure
The increase from the prior year was primarily driven by strong growth in sales volume and favorable price realization in all three…
Source quote
“The increase from the prior year was primarily driven by strong growth in sales volume and favorable price realization in all three... As I mentioned, sales and revenues were $20.7 billion, and they were in line with our expectations. Third quarter adjusted operating profit margin was 20.6%.”
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Guidance
In Asia Pacific, sales to users outside of China were lower than Caterpillar anticipated and declined slightly due to timing.
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Guidance
Rail services are anticipated to grow for the year, and Caterpillar now expects locomotive deliveries to be slightly lower year-over-year due to timing of deliveries.
Tone
How upbeat the language was, compared with other companiesiTone counts positive minus negative finance words, adjusted for length. Executives mostly speak positively, so the labels compare each call with every company's latest call: “typical” is the middle third, “very upbeat” the top tenth, “cautious” the bottom tenth.. Dot: Q3 2026. Ring: Q2 2026.
Management sounded noticeably less positive answering analysts than in its prepared script — a bigger drop than in 88% of calls. Scripts are polished in advance; a drop under questioning often marks the topics analysts pressed on, so the answers deserve a closer read than the script.
Sentences that drove the tone
“For full year 2026, we expect strong sales-to-users growth, primarily driven by rising demand for copper and gold, increasing activity in the Canadian oil sands, and positive dynamics in heavy...”
“We're seeing continued positive momentum in resource industries, with robust order rates driving strong backlog growth.”
“We continue to see momentum in, you know, standby diesel backup, which has been the growing base of our business for quite a while, you know, before even really AI...”
Full figures
USD · SEC EDGAR XBRL (10-Q, period end 2026-09-30)
| Metric | Q3 2026period end 2026-09-30 | Q2 2026period end 2026-06-30 | Change | Q3 2025 | YoY |
|---|---|---|---|---|---|
| Revenue | 20.68B | 20.54B | +0.7% | 17.64B | +17.3% |
| Gross profit | 7.35B | 7.76B | −5.3% | 5.96B | +23.2% |
| Operating income | 4.21B | 4.29B | −1.9% | 3.05B | +38.1% |
| Net income | 3.29B | 3.59B | −8.5% | 2.30B | +42.9% |
| EPS | 7.13 | 7.77 | −8.2% | 4.88 | +46.1% |
| P/E today 21.9 | 31.8 | 45.9 | −14.1 | 24.5 | +7.3 |
Topics
Most discussed now
- Caterpillar's team continues to execute its strategic priorities in a dynamic environment, positioning us for a strong year.
- Any rebroadcast, retransmission, reproduction, or distribution of all or part of this content without Caterpillar's prior written…
- Bringing additional capacity online is still the top pacing factor for growth in power and energy, so working diligently to...
- Specifically, Caterpillar's power and energy team continued to increase production of large reciprocating engines and turbines while…
- In particular, Caterpillar has seen it's large infrastructure projects, high IJA spending still has a lot of money left to be...
Faded since Q2 2026
- Fading Increases in North America were better than Caterpillar anticipated as the growth was driven by very strong rental fleet loading...
- Fading I expect it to be a pretty healthy piece of STU growth in the third quarter as Caterpillar really just...
- Dropped Orders in those, at least in the next couple of years or Caterpillar wouldns't have made the decision to bring...
- Fading Strong order rates and a growing backlog reflect broadening momentum across Caterpillar's business.
Latest announcements
Official filings, newest first. Summaries are generated from each filing and its attachment; every figure is checked against the source.
- Results of operations; Regulation FD disclosure · SEC 8-K
- Director or officer change; Other events · SEC 8-K
Caterpillar announced that Denise Johnson will retire as group president of Resource Industries on February 1, 2027, with Derrick York appointed to the role effective November 1, 2026.
- Material agreement; New financial obligation · SEC 8-K
Caterpillar entered into a 364-Day Credit Agreement providing an unsecured revolving credit facility of up to $3.5 billion, replacing the 2025 facility entered into on August 28, 2025.
- Results of operations; Regulation FD disclosure · SEC 8-K
Caterpillar reported second-quarter 2026 sales and revenues of $20.5 billion, an increase of 24% compared to $16.6 billion in the second quarter of 2025.
- Shareholder vote results; Regulation FD disclosure · SEC 8-K
Caterpillar Inc. declared a quarterly cash dividend of $1.63 per share, which is an increase of 12 cents from the previous quarterly dividend of $1.51.
- Results of operations; Regulation FD disclosure · SEC 8-K
Caterpillar reported first-quarter 2026 sales and revenues of $17.4 billion, an increase of 22% compared to $14.2 billion in the first quarter of 2025.
- Other events · SEC 8-K
Caterpillar Inc. announced the nomination of Lynn Good as a director nominee for the 2026 Annual Meeting of Shareholders, with an effective appointment date of August 1, 2026.
- Director or officer change · SEC 8-K
Caterpillar Inc. appointed Kyle Epley as Chief Financial Officer effective May 1, 2026, with a new annual salary of $930,500.
Balance sheet & ownership
From SEC filings; short interest is FINRA data via Yahoo. Collected 2026-10-18.
Cash & runway
Cash & equivalents
$6.71B
2026-06-30
Short-term investments
$378.0M
total $7.09B
Implied runway
—
operating cash flow positive over the TTM window
Dilution
weighted-average basic shares, per quarter. Change: -2.0% YoY, -0.6% QoQ.
| Quarter | Shares |
|---|---|
| Q3 2024 | 484.2M |
| Q1 2025 | 474.9M |
| Q2 2025 | 469.7M |
| Q3 2025 | 468.6M |
| Q1 2026 | 463.4M |
| Q2 2026 | 460.4M |
Shares outstanding: 459.7M (2026-06-30)
Insider transactions
Form 4 open-market trades (codes S/P), trailing 12 months. Coverage: newest 50 of 114 filings; 50 filings parsed.
Sold by insiders
128.2K shares
$113.9M · 35 transactions
Bought by insiders
250 shares
$219.2K · 1 transactions
Net direction
net selling
Catalyst calendar
management-stated targets — from the latest earnings call; plans, not promises.
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full year 2026
sales and revenues expectations
Source quote
“We are increasing our full year 2026 sales and revenues expectations to mid- to high teens growth based on the healthy demand we are seeing across all 3 of our primary segments.”
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second half of the year
increase our throughput
Source quote
“We are also progressing on our capacity expansion plans, and we expect to increase our throughput in the second half of the year.”
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next 12 months
delivery of 59% of $72 billion backlog
Source quote
“Currently, 59% of our $72 billion backlog is expected to be delivered over the next 12 months.”
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2030
placing orders
Source quote
“Power & Energy customers continue planning with us by sharing their long-term forecasts, and some are placing orders as far out as 2030.”
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2026
outlook for Power & Energy
Source quote
“Our positive outlook for 2026 continues to reflect strong demand in power generation and oil and gas.”