Caterpillar Finds Growth Abroad: Fool by Numbers

On Jan. 25, heavy machinery heavyweight Caterpillar (NYSE: CAT  ) released earnings for the 2007 fiscal year -- a period ending Dec. 31, 2007.

  • Domestic machinery sales were slow at 11% below the 2006 level, thanks to "the collapse in housing construction" and lower demand from rock quarries and other basic materials extractors. But outside these Yankee-Canadian borders, machinery sales increased 33%.
  • The same story played out in the engines segment, only amplified: Overall engine sales improved 6% despite a hair-raising 59% North American drop.
  • Our CAPS players seem to like heavy machinery a lot. Get a free CAPS account and go see what's up with that international imbalance.

(Figures in millions, except per-share data.)

Income Statement Highlights

FY 2007

FY 2006

Change

Sales

$44,958

$41,517

8.3%

Net Profit

$3,541

$3,537

0.1%

EPS

$5.37

$5.17

3.9%

Diluted Shares

659.5

683.8

(3.6%)

Get back to basics with the income statement.

Margin Checkup

FY 2007

FY 2006

Change*

Gross Margin

27.4%

28.8%

(1.4)

Operating Margin

11.0%

12.0%

(1.1)

Net Margin

7.9%

8.5%

(0.6)

*Expressed in percentage points.

Margins are the earnings engine.

Balance Sheet Highlights

Assets

FY 2007

FY 2006

Change

Cash + ST Invest.

$1,122

$530

109.8%

Accounts Rec.

$8,249

$8,607

(4.2%)

Inventory

$7,204

$6,351

13.4%

Liabilities

FY 2007

FY 2006

Change

Accounts Payable

$4,723

$4,085

15.6%

Long-Term Debt*

$3,639

$3,694

(1.5%)

*Excluding financial services borrowings.

The balance sheet reflects the company's health.

Cash Flow Highlights

FY 2007

FY 2006

Change

Cash From Ops.

$7,935

$5,799

36.8%

Capital Expenditures

$3,040

$2,675

13.6%

Free Cash Flow

$4,895

$3,124

56.7%

Owner Earnings

$2,298

$2,464

(6.7%)

Free cash flow is a Fool's best friend.

Competitive Context

Market Cap (in billions)

Trailing P/E Ratio

CAPS Rating

General Electric (NYSE:GE)

$345.7

15.8

****

Caterpillar

$42.2

12.4

****

Deere (NYSE:DE)

$36.5

21.1

****

Cummins (NYSE:CMI)

$10.0

13.5

****

Using the latest reported numbers from Capital IQ.

Keep your partners close and the competition in your vest pocket.

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Related Tickers

4/17/2014 4:01 PM
CAT $102.83 Down -0.10 -0.10%
Caterpillar, Inc. CAPS Rating: ***
CMI $146.28 Up +0.98 +0.67%
Cummins CAPS Rating: *****
DE $93.40 Up +0.25 +0.27%
Deere & Company CAPS Rating: ****
GE $26.56 Up +0.44 +1.68%
General Electric C… CAPS Rating: ****

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