CaterpillarLIM:CAT 68 ROE % is 51.01% as of Mar. 2026, which is 21% above its 10-year median of 42.01. GuruFocus rates LIM:CAT with a GF Score™ of 68/100 and a GF Value™ of $395.02 (Significantly Overvalued). The stock has 6 warning signs investors should review. Among 204 Farm & Heavy Construction Machinery companies, Caterpillar ranks better than 97.06% on this metric.
ROE % is calculated as Net Income divided by its average Total Stockholders Equity over a certain period of time. Caterpillar's annualized net income for the quarter that ended in Mar. 2026 was $10,196 Mil. Caterpillar's average Total Stockholders Equity over the quarter that ended in Mar. 2026 was $19,990 Mil. Therefore, Caterpillar's annualized ROE % for the quarter that ended in Mar. 2026 was 51.01%.
The historical rank and industry rank for Caterpillar's ROE % or its related term are showing as below:
LIM:CAT'
s ROE % Range Over the Past 10 Years
Min: -0.48 Med: 42.01 Max: 58.45
Current: 48.43
During the past 13 years, Caterpillar's highest ROE % was 58.45%. The lowest was -0.48%. And the median was 42.01%.
LIM:CAT's ROE % is ranked better than 97.06% of 204
companies
in the Farm & Heavy Construction Machinery industry
Industry Median: 7.155
vs LIM:CAT: 48.43
Caterpillar (LIM:CAT) ROE % Explanation
ROE % measures the rate of return on the ownership interest (shareholder's equity) of the common stock owners. It measures a firm's efficiency at generating profits from every unit of shareholders' equity (also known as net assets or assets minus liabilities). ROE % shows how well a company uses investment funds to generate earnings growth. ROE %s between 15% and 20% are considered desirable.
The factors that affect a company's ROE % can be illustrated with the three-step DuPont Analysis:
Note:
The net income data used here is four times the quarterly (Mar. 2026) net income data. The Revenue data used here is four times the quarterly (Mar. 2026) revenue data. The same rule applies to Pre-Tax Income and Operating Income.
* In the five-step DuPont Analysis, Operating Income is only available for non-financial companies. Thus, for Insurance companies, we use EBIT as a substitution of Operating Income. For Banks, both Operating Income and EBIT is unavailable. Thus we combined Interest Burden and Operating Margin % into Pretax Margin %, and the DuPont Analysis is divided into four components instead.
* 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.
Be Aware
Net Income is used.
Because a company can increase its ROE % by having more financial leverage, it is important to watch the equity multiplier when investing in high ROE % companies. Like ROA %, ROE % is calculated with only 12 months data. Fluctuations in company's earnings or business cycles can affect the ratio drastically. It is important to look at the ratio from a long term perspective.
Asset light businesses require very few assets to generate very high earnings. Their ROE %s can be extremely high.
Caterpillar ROE % Related Terms
Caterpillar ROE % Historical Data
* Premium members only.
The historical data trend for Caterpillar's ROE % 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.
For the Farm & Heavy Construction Machinery subindustry, Caterpillar's ROE %, along with its competitors' market caps and ROE % 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 ROE % vs Farm & Heavy Construction Machinery Industry
For the Farm & Heavy Construction Machinery industry and Industrials sector, Caterpillar's ROE % distribution charts can be found below:
* The bar in red indicates where Caterpillar's ROE % 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.
In the calculation of annual ROE %, the net income of the last fiscal year and the average total shareholder equity over the fiscal year are used. In calculating the quarterly data,
the net income data used here is four times the quarterly (Mar. 2026) net income data.
ROE % is displayed in the 30-year financial page.
Caterpillar (LIM:CAT) has a ROE % of 51.01% as of Mar. 2026. Return on equity is the ratio of current-period net income to average two-period total equity. View historical data on Caterpillar and its competitors. This is 21% above median its historical median of 42.01. According to the industry distribution chart, Caterpillar ranks #6 out of 204 companies in the Farm & Heavy Construction Machinery industry, placing it in the top 2.9%.
Is Caterpillar's ROE % too high?
Caterpillar's current ROE % of 51.01% is 21% above median its 10-year median of 42.01. The Farm & Heavy Construction Machinery industry median ROE % is 7.16. Caterpillar's value of 51.01% is 612.9% above this industry median. Based on the distribution chart, Caterpillar ranks #6 out of 204 companies in the Farm & Heavy Construction Machinery industry, which is in the top quartile — a strong position relative to peers. Overall, Caterpillar has a GF Score™ of 68/100 and is considered Significantly Overvalued, reflecting its overall financial health beyond just this single metric.
How does Caterpillar's ROE % compare to DE and PCAR?
According to the Farm & Heavy Construction Machinery industry distribution chart, Caterpillar ranks #6 out of 204 companies for ROE %. This places Caterpillar in the top 3% of its industry — outperforming the majority of peers. The industry median ROE % is 7.16. Caterpillar's value of 51.01% is 612.9% above this benchmark. While the company's 10-year median is 42.01 vs. the industry median of 7.16, Caterpillar has consistently been above the industry average. See the competitive comparison table and distribution chart on this page for a detailed peer-by-peer breakdown.
What is a good ROE % for a Farm & Heavy Construction Machinery company?
The median ROE % among Farm & Heavy Construction Machinery companies is 7.16, based on 204 companies in the industry. Companies in the top quartile (top 25%) have a ROE % significantly above this median, while those in the bottom quartile fall well below. However, ROE % should not be evaluated in isolation — investors should consider it alongside profitability, growth, and financial strength metrics. Caterpillar's current ROE % of 51.01% is 612.9% above 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 ROE % mean?
A high ROE % can signal that a stock is expensive relative to its fundamentals. Return on equity is the ratio of current-period net income to average two-period total equity. View historical data on Caterpillar and its competitors. For the Farm & Heavy Construction Machinery industry, the median ROE % is 7.16 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Caterpillar's current ROE % is 51.01%, which is 21% above median its own 10-year median of 42.01. 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?
Based on GuruFocus' analysis, Caterpillar (LIM:CAT) is currently considered Significantly Overvalued. The stock's GF Value™ is $395.02, compared to a current price of $996.00 — trading 152.1% above its estimated fair value. The current ROE % is 51.01%, which is 21% above median its 10-year median of 42.01 and 612.9% above the Farm & Heavy Construction Machinery industry median of 7.16. Caterpillar's overall GF Score™ is 68/100 with 6 warning signs to review. Investors should evaluate multiple metrics — including profitability, growth, and financial strength — before making a decision.
How is ROE % calculated?
ROE % is calculated from a company's financial statements. For Caterpillar (LIM:CAT), the current ROE % is 51.01% as of Mar. 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 (LIM:CAT) Overvalued in 2026?
Based on GuruFocus' analysis, Caterpillar stock appears to be overvalued.
The current stock price of $996.00 is trading 152.1% above its estimated GF Value™ of $395.02.
GuruFocus considers Caterpillar to be Significantly Overvalued.
Key valuation signals for LIM:CAT:
ROE %: 51.01% (21% above median its 10-year median of 42.01)
GF Value™: $395.02 vs. price of $996.00 (152.1% above fair value)
Industry Position: 612.9% above the Farm & Heavy Construction Machinery median (#6 of 204)
No single metric tells the full story. See the LIM: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.
68GF Score
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