Caterpillar Inc (NYSE:CAT). announced an upcoming dividend of $1.30 per share on Tuesday, which will lead to a yearly total of $5.20 per share. This announcement comes as the company is nearing its ex-dividend date, with shareholders required to purchase before the deadline to be eligible for the dividend payout.
With a current stock price of $270.79, Caterpillar's trailing yield stands at approximately 1.9%. According to InvestingPro's real-time metrics, Caterpillar's market capitalization is around 138.97B USD, and it has a P/E ratio of 16.92. The company maintains a sustainable dividend payout ratio of 30% from its earnings, thus minimizing any risk of dividend reduction.
In addition to its dividend strategy, Caterpillar earmarks just 34% of its free cash flow for dividends, indicating a strategy of earnings reinvestment. This approach aligns with the firm's robust annual earnings growth rate of 67% over the past five years. InvestingPro's data shows that Caterpillar's revenue growth has been accelerating, with a growth rate of 19.88% in the last twelve months up to Q2 2023.
Over the last decade, Caterpillar has also demonstrated a steady increase in dividends, averaging around 9.6% per year. This consistent growth highlights both the stock price and the sustainability of its earnings growth, reinforcing Caterpillar's commitment to providing value to its shareholders while ensuring the financial health of the company.
InvestingPro Tips also highlights that Caterpillar has consistently increased its earnings per share and has raised its dividend for 10 consecutive years. The company operates with a high return on assets, as evidenced by a return of 10.04% in the last twelve months up to Q2 2023. It's also worth noting that Caterpillar has maintained dividend payments for 53 consecutive years, a testament to the company's stability and commitment to its shareholders.
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