Caterpillar Inc (CAT)vsIllinois Tool Works Inc (ITW)
CAT
Caterpillar Inc
$695.40
-4.02%
INDUSTRIALS · Cap: $325.43B
ITW
Illinois Tool Works Inc
$259.04
-0.89%
INDUSTRIALS · Cap: $74.66B
Smart Verdict
WallStSmart Research — data-driven comparison
Caterpillar Inc generates 321% more annual revenue ($67.59B vs $16.04B). ITW leads profitability with a 19.1% profit margin vs 13.1%. CAT appears more attractively valued with a PEG of 1.86. ITW earns a higher WallStSmart Score of 58/100 (C).
CAT
Buy57
out of 100
Grade: C
ITW
Buy58
out of 100
Grade: C
Intrinsic Value Comparison
Multi-model valuation · Graham Formula
Margin of Safety
-444.6%
Fair Value
$127.70
Current Price
$695.40
$567.70 premium
Margin of Safety
-53.8%
Fair Value
$193.86
Current Price
$259.04
$65.18 premium
Key Strengths & Concerns
Side-by-side fundamental analysis
Key Strengths
Mega-cap, among the largest globally
Every $100 of equity generates 44 in profit
18.0% revenue growth
Generating 2.2B in free cash flow
Every $100 of equity generates 94 in profit
Safe zone — low bankruptcy risk
Large-cap with strong market position
Strong operational efficiency at 26.8%
Areas to Watch
Expensive relative to growth rate
Premium valuation, high expectations priced in
Trading at 15.2x book value
Weak financial health signals
4.1% revenue growth
Weak financial health signals
Expensive relative to growth rate
Trading at 23.2x book value
Comparative Analysis Report
WallStSmart ResearchBull Case : CAT
The strongest argument for CAT centers on Market Cap, Return on Equity, Revenue Growth. Revenue growth of 18.0% demonstrates continued momentum.
Bull Case : ITW
The strongest argument for ITW centers on Return on Equity, Altman Z-Score, Market Cap. Profitability is solid with margins at 19.1% and operating margin at 26.8%.
Bear Case : CAT
The primary concerns for CAT are PEG Ratio, P/E Ratio, Price/Book. Debt-to-equity of 2.03 is elevated, increasing financial risk.
Bear Case : ITW
The primary concerns for ITW are Revenue Growth, Piotroski F-Score, PEG Ratio.
Key Dynamics to Monitor
CAT profiles as a growth stock while ITW is a value play — different risk/reward profiles.
CAT carries more volatility with a beta of 1.53 — expect wider price swings.
CAT is growing revenue faster at 18.0% — sustainability is the question.
CAT generates stronger free cash flow (2.2B), providing more financial flexibility.
Bottom Line
ITW scores higher overall (58/100 vs 57/100), backed by strong 19.1% margins. Both earn "Buy" and "Buy" ratings respectively — the choice depends on your investment horizon and risk tolerance.
This analysis is generated from publicly available financial data. Not financial advice.
Caterpillar Inc
INDUSTRIALS · FARM & HEAVY CONSTRUCTION MACHINERY · USA
Caterpillar Inc. (often shortened to CAT) is an American Fortune 100 corporation that designs, develops, engineers, manufactures, markets, and sells machinery, engines, financial products, and insurance to customers via a worldwide dealer network.
Visit Website →Illinois Tool Works Inc
INDUSTRIALS · SPECIALTY INDUSTRIAL MACHINERY · USA
Illinois Tool Works Inc. or ITW is an American company that produces engineered fasteners and components, equipment and consumable systems, and specialty products.
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