Caterpillar (NYSE:CAT) Announces Quarterly Earnings Results, Beats Estimates By $1.95 EPS

Caterpillar (NYSE:CAT) issued its quarterly earnings results on Tuesday. The industrial products company reported $8.17 earnings per share for the quarter, beating analysts’ consensus estimates of $6.22 by $1.95, FiscalAI reports. The firm had revenue of $20.54 billion during the quarter, compared to the consensus estimate of $19.34 billion. Caterpillar had a net margin of 13.33% and a return on equity of 48.21%. The business’s revenue was up 23.7% on a year-over-year basis. During the same period in the prior year, the firm earned $4.72 EPS.

Here are the key takeaways from Caterpillar’s conference call:

• Record quarterly performance: Caterpillar reported $20.5 billion in second-quarter sales and revenues, up 24% year over year, with adjusted profit per share rising 73% to $8.17. Backlog increased $9 billion sequentially to a record $72 billion.
• Full-year outlook raised: The company now expects 2026 sales and revenues to grow in the mid-to-high teens, with stronger growth anticipated across Power & Energy, Construction Industries, and Resource Industries. MP&E free cash flow is expected to be in the top half of its $6 billion-$15 billion target range.
• Strong power-generation demand: Power-generation sales to users rose 72%, driven by data-center, cloud-computing, and generative-AI demand. Caterpillar is restarting production of a 10-megawatt gas engine platform, adding approximately 1.5 gigawatts of capacity with shipments expected to begin in the fourth quarter.
• Growth investments and rental expansion: Caterpillar is expanding capacity, investing in technology and autonomy, and using its Major Projects dealer-owned rental venture to support large infrastructure, energy, manufacturing, and data-center projects. These initiatives are intended to drive longer-term growth but will increase depreciation, SG&A, and R&D expenses.
• Tariffs remain a material cost: Second-quarter tariff costs were approximately $400 million, while full-year 2026 tariff costs are now expected to be around $2.2 billion, excluding approximately $400 million of expected IEEPA recoveries recognized in the second quarter. Management expects the full-year adjusted operating margin, excluding those recoveries, to be near the bottom of its target range.

Caterpillar Price Performance

CAT stock traded up $47.14 during trading on Tuesday, hitting $877.17. 2,838,072 shares of the stock traded hands, compared to its average volume of 2,915,600. The stock has a market cap of $404.02 billion, a price-to-earnings ratio of 43.63, a P/E/G ratio of 1.59 and a beta of 1.60. Caterpillar has a one year low of $405.46 and a one year high of $1,073.46. The company has a current ratio of 1.35, a quick ratio of 0.81 and a debt-to-equity ratio of 1.64. The company has a 50 day simple moving average of $923.52 and a 200 day simple moving average of $814.19.

Caterpillar Increases Dividend

The company also recently declared a quarterly dividend, which will be paid on Wednesday, August 19th. Investors of record on Monday, July 20th will be issued a dividend of $1.63 per share. The ex-dividend date of this dividend is Monday, July 20th. This represents a $6.52 annualized dividend and a yield of 0.7%. This is an increase from Caterpillar’s previous quarterly dividend of $1.51. Caterpillar’s payout ratio is 32.45%.

Analysts Set New Price Targets

CAT has been the subject of a number of research analyst reports. JPMorgan Chase & Co. upped their price objective on shares of Caterpillar from $1,125.00 to $1,165.00 and gave the company an “overweight” rating in a research report on Wednesday, June 17th. Barclays lifted their target price on Caterpillar from $700.00 to $800.00 and gave the stock an “equal weight” rating in a research report on Friday, May 1st. Robert W. Baird reaffirmed a “neutral” rating and issued a $900.00 price target (down from $1,200.00) on shares of Caterpillar in a report on Wednesday, July 29th. Wall Street Zen upgraded Caterpillar from a “hold” rating to a “buy” rating in a research report on Saturday, May 2nd. Finally, HSBC lifted their price objective on Caterpillar from $850.00 to $1,100.00 in a report on Tuesday, May 5th. Thirteen investment analysts have rated the stock with a Buy rating and twelve have given a Hold rating to the company’s stock. According to data from MarketBeat, the company has a consensus rating of “Moderate Buy” and an average price target of $966.29.

Insider Activity

In other news, CAO William E. Schaupp sold 360 shares of the firm’s stock in a transaction that occurred on Wednesday, May 13th. The shares were sold at an average price of $906.00, for a total transaction of $326,160.00. Following the completion of the sale, the chief accounting officer owned 530 shares of the company’s stock, valued at approximately $480,180. This trade represents a 40.45% decrease in their ownership of the stock. The transaction was disclosed in a filing with the SEC, which is accessible through this link. Also, insider Lange Bob De sold 24,222 shares of Caterpillar stock in a transaction that occurred on Wednesday, May 6th. The shares were sold at an average price of $922.92, for a total transaction of $22,354,968.24. Following the completion of the transaction, the insider owned 86,029 shares of the company’s stock, valued at $79,397,884.68. This trade represents a 21.97% decrease in their position. The disclosure for this sale is available in the SEC filing. In the last three months, insiders sold 84,492 shares of company stock valued at $77,567,548. Corporate insiders own 0.33% of the company’s stock.

Hedge Funds Weigh In On Caterpillar

A number of institutional investors and hedge funds have recently bought and sold shares of CAT. Ankerstar Wealth LLC bought a new position in shares of Caterpillar in the fourth quarter valued at about $43,000. Strive Financial Group LLC bought a new stake in Caterpillar during the 4th quarter worth about $45,000. IFC & Insurance Marketing Inc. acquired a new stake in Caterpillar in the 4th quarter valued at about $46,000. Osterweis Capital Management Inc. acquired a new stake in Caterpillar in the 4th quarter valued at about $52,000. Finally, Advocate Investing Services LLC bought a new position in shares of Caterpillar in the fourth quarter worth about $57,000. Institutional investors and hedge funds own 70.98% of the company’s stock.

Caterpillar News Roundup

Here are the key news stories impacting Caterpillar this week:

• Positive Sentiment: Large earnings and revenue beats: Caterpillar reported adjusted profit of $8.17 per share, versus the roughly $6.22-$6.25 analyst consensus, while sales and revenue rose 24% year over year to $20.5 billion, exceeding expectations near $19.3-$19.4 billion. Adjusted EPS increased sharply from $4.72 a year earlier. Caterpillar Reports Second-Quarter 2026 Results
• Positive Sentiment: AI-related demand is strengthening the power business: Rising construction of data centers is driving demand for Caterpillar’s engines, generators and other power-generation equipment. Continued strength in construction and mining equipment also contributed to higher sales and profit. Caterpillar Surges as Data Center Boom Drives Earnings Growth
• Positive Sentiment: Improved outlook and order visibility: Management raised its full-year revenue-growth forecast to the mid-to-high teens percentage range from the prior low-double-digit outlook. Reports also pointed to a record order backlog of approximately $63 billion, supporting expectations for continued demand. CAT Stock Rises on Earnings Beat and Revenue Forecast
• Positive Sentiment: Shareholder returns remain supportive: Caterpillar deployed $2.2 billion toward share repurchases and dividends during the quarter, reinforcing its strong cash-generation profile. The results also lifted the broader Dow as investors responded positively to industrial and AI-infrastructure spending trends. Caterpillar Stock Jumps as Company Sees Broadening Momentum
• Neutral Sentiment: The strong report follows a period in which CAT was pressured by an AI-related selloff. Investors may now focus on whether data-center demand and the sizable backlog can justify the stock’s elevated valuation and sustain the recent momentum.

Caterpillar Company Profile

Caterpillar Inc is a global manufacturer of construction and mining equipment, diesel and natural gas engines, industrial gas turbines and locomotives. The company’s product portfolio includes earthmoving machines such as excavators, bulldozers, wheel loaders and off‑highway trucks, as well as a range of power generation products including generator sets and power systems for industrial and commercial use. Caterpillar serves customers across heavy construction, mining, energy, transportation and related industries with both equipment and integrated technology solutions.

In addition to manufacturing, Caterpillar provides a broad range of aftermarket parts and support services, including maintenance, repair, remanufacturing and fleet management tools.