Caterpillar Inc (CAT)

Activity ratios

Short-term

Turnover ratios

	Dec 31, 2024	Sep 30, 2024	Jun 30, 2024	Mar 31, 2024	Dec 31, 2023	Sep 30, 2023	Jun 30, 2023	Mar 31, 2023	Dec 31, 2022	Sep 30, 2022	Jun 30, 2022	Mar 31, 2022	Dec 31, 2021	Sep 30, 2021	Jun 30, 2021	Mar 31, 2021	Dec 31, 2020	Sep 30, 2020	Jun 30, 2020	Mar 31, 2020
Inventory turnover	2.46	2.43	2.49	2.56	2.64	2.52	2.47	2.41	2.58	2.39	2.43	2.49	2.56	2.47	2.53	2.50	2.60	2.71	2.88	3.03
Receivables turnover	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—
Payables turnover	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—
Working capital turnover	4.83	5.16	6.96	5.93	5.49	4.47	5.54	4.47	4.85	4.58	4.15	4.04	3.75	3.04	2.97	2.69	3.04	3.22	3.68	4.60

Based on the provided data for Caterpillar Inc, we can analyze the activity ratios as follows:

1. Inventory Turnover: The inventory turnover ratio measures how efficiently a company manages its inventory. Caterpillar's inventory turnover has been decreasing slightly over the periods, from 3.03 in March 2020 to 2.46 in December 2024. This indicates that the company is selling its inventory at a slightly slower pace over time.

2. Receivables Turnover: Unfortunately, data for the receivables turnover ratio is not available in the provided dataset. Without this information, we are unable to assess how quickly Caterpillar collects its receivables from customers.

3. Payables Turnover: Similarly, data for the payables turnover ratio is not available in the dataset. This ratio would have provided insights into how quickly Caterpillar pays its suppliers and vendors.

4. Working Capital Turnover: The working capital turnover ratio measures how efficiently a company utilizes its working capital to generate sales. Caterpillar's working capital turnover has shown fluctuations over the periods, ranging from 2.69 in March 2021 to 6.96 in June 2024. The increasing trend in this ratio indicates that the company is utilizing its working capital more efficiently to generate sales in recent periods.

Overall, while the inventory turnover has shown a slight decline, the working capital turnover ratio's increasing trend suggests improvements in Caterpillar's operational efficiency in utilizing its resources to drive sales. However, the lack of data for receivables and payables turnover ratios limits a comprehensive assessment of the company's overall activity efficiency.

Average number of days

		Dec 31, 2024	Sep 30, 2024	Jun 30, 2024	Mar 31, 2024	Dec 31, 2023	Sep 30, 2023	Jun 30, 2023	Mar 31, 2023	Dec 31, 2022	Sep 30, 2022	Jun 30, 2022	Mar 31, 2022	Dec 31, 2021	Sep 30, 2021	Jun 30, 2021	Mar 31, 2021	Dec 31, 2020	Sep 30, 2020	Jun 30, 2020	Mar 31, 2020
Days of inventory on hand (DOH)	days	148.22	150.16	146.56	142.58	138.05	144.86	147.93	151.19	141.68	153.01	150.19	146.39	142.46	147.69	144.08	146.03	140.26	134.59	126.69	120.34
Days of sales outstanding (DSO)	days	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—
Number of days of payables	days	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—

The Days of Inventory on Hand (DOH) for Caterpillar Inc have shown fluctuations over the years, varying between 120.34 days to 153.01 days. A lower DOH indicates efficient inventory management, while a higher DOH suggests possible overstocking or slow-moving inventory.

The Days of Sales Outstanding (DSO) and Number of Days of Payables data are not available for analysis, indicating a lack of visibility into the company's accounts receivable collection period and accounts payable turnover.

Overall, the DOH figures suggest that Caterpillar Inc may need to focus on optimizing its inventory levels to improve working capital efficiency and enhance profitability. Monitoring and controlling inventory levels effectively can positively impact cash flow and overall operational performance.

Long-term

	Dec 31, 2024	Sep 30, 2024	Jun 30, 2024	Mar 31, 2024	Dec 31, 2023	Sep 30, 2023	Jun 30, 2023	Mar 31, 2023	Dec 31, 2022	Sep 30, 2022	Jun 30, 2022	Mar 31, 2022	Dec 31, 2021	Sep 30, 2021	Jun 30, 2021	Mar 31, 2021	Dec 31, 2020	Sep 30, 2020	Jun 30, 2020	Mar 31, 2020
Fixed asset turnover	—	—	—	—	—	5.42	5.34	5.15	4.94	7.25	4.60	4.41	6.24	6.08	3.82	3.54	3.37	3.57	3.77	4.08
Total asset turnover	0.74	0.76	0.80	0.80	0.77	0.77	0.76	0.74	0.73	0.70	0.67	0.64	0.62	0.60	0.56	0.53	0.53	0.57	0.61	0.67

Caterpillar Inc's long-term activity ratios show the efficiency of the company in generating sales relative to its fixed assets and total assets.

1. Fixed Asset Turnover:
- The fixed asset turnover ratio measures how efficiently the company generates sales using its fixed assets.
- The trend of Caterpillar Inc's fixed asset turnover ratio fluctuates over the years, ranging from 3.37 to 7.25.
- The ratio was relatively stable from 2020 to 2022, averaging around 4 to 5 times.
- Notably, there was a significant increase in the fixed asset turnover ratio in September 2021 and September 2022, indicating a higher efficiency in utilizing fixed assets to generate sales during those periods.
- The ratio then decreased in December 2022, followed by a slight increase in March 2023 and June 2023.

2. Total Asset Turnover:
- The total asset turnover ratio reflects how effectively the company utilizes its total assets to generate revenue.
- Caterpillar Inc's total asset turnover ratio showed a gradual increase from 0.53 in December 2020 to 0.80 in June 2024.
- The company improved its efficiency in utilizing total assets to generate sales over the years.
- Despite some fluctuations, the overall trend indicates that the company has been more effective in generating revenue per dollar of assets as time progressed.

In conclusion, Caterpillar Inc has shown varying levels of efficiency in utilizing both fixed assets and total assets to generate sales over the years. The improvements in both fixed asset turnover and total asset turnover ratios suggest a positive trend in the company's operational efficiency and asset utilization.