Focused on building reliable datasets, financial models, and research tools for value-minded investors. Committed to turning complex data into practical guidance for value-investing and long-term wealth.
Dr. Charlie Tian is the founder and CEO of GuruFocus.com, a leading global investment research platform established in 2004. With a Ph.D. in physics, Dr. Tian transitioned from science to finance, applying a data-driven, disciplined approach to value investing.
CaterpillarXSWX:CAT 83 Degree of Operating Leverage is 1.00 as of Jun. 2026. GuruFocus rates XSWX:CAT with a GF Score™ of 83/100 and a GF Value™ of CHF363.47. The stock has 2 warning signs investors should review. Among 207 Farm & Heavy Construction Machinery companies, Caterpillar ranks worse than 50.24% on this metric.
Degree of Operating Leverage (DOL) measures the percentage change in EBIT for a unit change in Revenue.
Caterpillar's Degree of Operating Leverage for the quarter that ended in Jun. 2026 was 1.00. The higher Degree of Operating Leverage, the higher operating risk the company will take.
The industry rank for Caterpillar's Degree of Operating Leverage or its related term are showing as below:
XSWX:CAT's Degree of Operating Leverage is ranked worse than 50.24% of 207
companies
in the Farm & Heavy Construction Machinery industry
Industry Median: 1
vs XSWX:CAT: 1.00
Caterpillar (XSWX:CAT) Degree of Operating Leverage Explanation
Degree of Operating Leverage (DOL) is a leverage ratio that measures the sensitivity of a company’s operting income, also referred to as Earnings Before Interest and Taxes (EBIT), to fluctuations in its Revenue. DOL is a method used to quantify a company’s operating risk. This risk is related to the company's structure of variable costs and fixed costs. Since the fixed costs do not allow the company to adjust the operating costs, the operating risk rises with a higher fixed-to-variable costs proportion.
A high Degree of Operating Leverage indicates that the company’s fixed costs exceed its variable costs. By increasing the sales, the company can earn more profits. In addition, the company must be able to maintain relatively high sales to cover all fixed costs.
Be Aware
The use of operating leverage varies across different industries and business sectors, and the application of Degree of Operating Leverage (DOL) should be adjusted accordingly.
Caterpillar Degree of Operating Leverage Related Terms
Caterpillar Degree of Operating Leverage Historical Data
* Premium members only.
The historical data trend for Caterpillar's Degree of Operating Leverage 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.
XSWX:CAT vs DE, PCAR, CNH: Degree of Operating Leverage Comparison
For the Farm & Heavy Construction Machinery subindustry, Caterpillar's Degree of Operating Leverage, along with its competitors' market caps and Degree of Operating Leverage data, can be viewed below:
* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.
Caterpillar Degree of Operating Leverage vs Farm & Heavy Construction Machinery Industry
For the Farm & Heavy Construction Machinery industry and Industrials sector, Caterpillar's Degree of Operating Leverage distribution charts can be found below:
* The bar in red indicates where Caterpillar's Degree of Operating Leverage falls into.
* 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.
** TTM data of EBIT and Revenue was used to calculate Degree of Operating Leverage.
*** Please be aware that the Degree of Operating Leverage calculations are based on company-level data using the primary share class. The calculated data provided is for demonstration purposes and may slightly differ from the results displayed in the title due to potential variations caused by currency exchange rate differences throughout the year.
What does a Degree of Operating Leverage of 1.00 mean?
Caterpillar (XSWX:CAT) has a Degree of Operating Leverage of 1.00 as of Jun. 2026. Degree of Operating Leverage (DOL) measures the percentage change in EBIT for a unit change in Revenue. View historical data for Caterpillar and its competitors. According to the industry distribution chart, Caterpillar ranks #104 out of 207 companies in the Farm & Heavy Construction Machinery industry, placing it in the top 50.2%.
Is Caterpillar's Degree of Operating Leverage too high?
Caterpillar's current Degree of Operating Leverage is 1.00. The Farm & Heavy Construction Machinery industry median Degree of Operating Leverage is 1.00. Caterpillar's value of 1.00 is 0% at this industry median. Based on the distribution chart, Caterpillar ranks #104 out of 207 companies in the Farm & Heavy Construction Machinery industry, which is below the industry midpoint. Overall, Caterpillar has a GF Score™ of 83/100, reflecting its overall financial health beyond just this single metric.
How does Caterpillar's Degree of Operating Leverage compare to DE and PCAR?
According to the Farm & Heavy Construction Machinery industry distribution chart, Caterpillar ranks #104 out of 207 companies for Degree of Operating Leverage. This places Caterpillar in the lower half of its industry. The industry median Degree of Operating Leverage is 1.00. Caterpillar's value of 1.00 is 0% at this benchmark. See the competitive comparison table and distribution chart on this page for a detailed peer-by-peer breakdown.
What is a good Degree of Operating Leverage for a Farm & Heavy Construction Machinery company?
The median Degree of Operating Leverage among Farm & Heavy Construction Machinery companies is 1.00, based on 207 companies in the industry. Companies in the top quartile (top 25%) have a Degree of Operating Leverage significantly above this median, while those in the bottom quartile fall well below. However, Degree of Operating Leverage should not be evaluated in isolation — investors should consider it alongside profitability, growth, and financial strength metrics. Caterpillar's current Degree of Operating Leverage of 1.00 is 0% at the industry median. Use the industry distribution chart on this page to see where any company falls relative to its peers.
What does a high Degree of Operating Leverage mean?
A high Degree of Operating Leverage can signal that a stock is expensive relative to its fundamentals. Degree of Operating Leverage (DOL) measures the percentage change in EBIT for a unit change in Revenue. View historical data for Caterpillar and its competitors. For the Farm & Heavy Construction Machinery industry, the median Degree of Operating Leverage is 1.00 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Caterpillar's current Degree of Operating Leverage is 1.00. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Caterpillar stock overvalued right now?
Caterpillar (XSWX:CAT) has a current Degree of Operating Leverage of 1.00. The stock's GF Value™ is CHF363.47, compared to a current price of CHF651.60 — trading 79.3% above its estimated fair value. The current Degree of Operating Leverage is 1.00 and 0% at the Farm & Heavy Construction Machinery industry median of 1.00. Caterpillar's overall GF Score™ is 83/100 with 2 warning signs to review. Investors should evaluate multiple metrics — including profitability, growth, and financial strength — before making a decision.
How is Degree of Operating Leverage calculated?
Degree of Operating Leverage is calculated from a company's financial statements. For Caterpillar (XSWX:CAT), the current Degree of Operating Leverage is 1.00 as of Jun. 2026. GuruFocus calculates this using data sourced from SEC filings and annual reports. See the calculation section and 30-year financial data on this page for the full breakdown.
Is Caterpillar (XSWX:CAT) Overvalued in 2026?
Based on GuruFocus' analysis, Caterpillar stock appears to be overvalued.
The current stock price of CHF651.60 is trading 79.3% above its estimated GF Value™ of CHF363.47.
Key valuation signals for XSWX:CAT:
Degree of Operating Leverage: 1.00
GF Value™: CHF363.47 vs. price of CHF651.60 (79.3% above fair value)
Industry Position: 0% at the Farm & Heavy Construction Machinery median (#104 of 207)
No single metric tells the full story. See the XSWX:CAT stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Caterpillar is the world's leading manufacturer of construction and mining equipment, off-highway diesel and natural gas engines, industrial gas turbines, and diesel-electric locomotives. Its reporting segments are construction, resource, energy, and transportation. Market share approaches 20% across many products. Caterpillar operates a captive finance subsidiary to facilitate sales. The firm has a global reach that is approximately evenly balanced between the US and the rest of the world. Construction skews more domestic, while the other divisions are more geographically diversified. An independent network of over 150 dealers operates approximately 2,800 facilities, giving Caterpillar reach into about 190 countries for sales and support services.
83GF Score
Get the complete analysis for XSWX:CAT
Degree of Operating Leverage is just one metric. See GF Value™, 30-year financials, guru trades, warning signs, and more.
Quick Browse
Personalize
Premium Gurus 
Create New Portfolio
XSWX:CAT has been successfully added to your 
