Caterpillar (XTER:CAT1) ROCE % : 25.10% (As of Dec. 2023)

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What is Caterpillar ROCE %?

ROCE % measures how well a company generates profits from its capital. It is calculated as EBIT divided by Capital Employed, where Capital Employed is calculated as Total Assets minus Total Current Liabilities. Caterpillar's annualized ROCE % for the quarter that ended in Dec. 2023 was 25.10%.

Caterpillar ROCE % Historical Data

The historical data trend for Caterpillar's ROCE % can be seen below:

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

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Caterpillar ROCE % Chart

Caterpillar Annual Data

Trend

Dec14

Dec15

Dec16

Dec17

Dec18

Dec19

Dec20

Dec21

Dec22

Dec23

ROCE %

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16.31

8.25

17.08

18.38

25.92

Caterpillar Quarterly Data
	Mar19	Jun19	Sep19	Dec19	Mar20	Jun20	Sep20	Dec20	Mar21	Jun21	Sep21	Dec21	Mar22	Jun22	Sep22	Dec22	Mar23	Jun23	Sep23	Dec23
ROCE %	Get a 7-Day Free Trial															16.94	21.51	29.48	28.29	25.10

Caterpillar ROCE % Calculation

Caterpillar's annualized ROCE % for the fiscal year that ended in Dec. 2023 is calculated as:

ROCE %	=	EBIT	/	( (Capital Employed	+	Capital Employed)	/ count )
		(A: Dec. 2023 )		(A: Dec. 2022 )		(A: Dec. 2023 )
	=	EBIT	/	( ( (Total Assets - Total Current Liabilities)	+	(Total Assets - Total Current Liabilities) )	/ count )
		(A: Dec. 2023 )		(A: Dec. 2022 )		(A: Dec. 2023 )
	=	12435.437	/	( ( (77354.192 - 29765.264)	+	(80215.492 - 31845.576) )	/ 2 )
	=	12435.437	/	( (47588.928	+	48369.916)	/ 2 )
	=	12435.437	/	47979.422
	=	25.92 %

Caterpillar's ROCE % of for the quarter that ended in Dec. 2023 is calculated as:

ROCE %	=	EBIT ⁽¹⁾	/	( (Capital Employed	+	Capital Employed)	/ count )
		(Q: Dec. 2023 )		(Q: Sep. 2023 )		(Q: Dec. 2023 )
	=	EBIT	/	( ( (Total Assets - Total Current Liabilities)	+	(Total Assets - Total Current Liabilities) )	/ count )
		(Q: Dec. 2023 )		(Q: Sep. 2023 )		(Q: Dec. 2023 )
	=	12379.5	/	( ( (81323.167 - 31037.188)	+	(80215.492 - 31845.576) )	/ 2 )
	=	12379.5	/	( ( 50285.979	+	48369.916 )	/ 2 )
	=	12379.5	/	49327.9475
	=	25.10 %

(1) Note: The EBIT data used here is four times the quarterly (Dec. 2023) EBIT data.

Caterpillar (XTER:CAT1) ROCE % Explanation

ROCE % can be especially useful when comparing the performance of capital-intensive companies. Unlike ROE %, which indicates the profitability of Shareholders Equity, ROCE % also considers long-term debt in Capital Employed. This can be helpful when analyzing companies with significant debt, as the result is neutralized by taking debt into consideration.

Generally speaking, a higher ROCE % indicates a stonger profitability for a company. Moreover, it is important to look at the ratio from a long term perspective. Investors tend to favor companies with stable and rising ROCE % trend over those with volatile ones.

Caterpillar ROCE % Related Terms

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Caterpillar (XTER:CAT1) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Industrials » Farm & Heavy Construction Machinery » Caterpillar Inc (XTER:CAT1) » Definitions » ROCE %

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Traded in Other Exchanges

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Address

5205 N. O'Connor Boulevard, Suite 100, Irving, TX, USA, 75039

Website

https://www.caterpillar.com

Caterpillar is the premier manufacturer of heavy equipment, power solutions, and locomotives. It is currently the world's largest manufacturer of heavy equipment with over 13% market share in 2021. The company is divided into four reportable segments: construction industries, resource industries, energy and transportation, and Caterpillar Financial Services. Its products are available through a dealer network that covers the globe with about 2,700 branches maintained by 160 dealers. Caterpillar Financial Services provides retail financing for machinery and engines to its customers, in addition to wholesale financing for dealers, which increases the likelihood of Caterpillar product sales.

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