CAT
Caterpillar Inc.
CAT has the edge over DRS overall, supported by stronger modeled upside and stronger fundamentals.
DRS
Leonardo DRS, Inc.
DRS offers stronger valuation, but that advantage does not outweigh its weaker overall profile.
CAT Fundamentals
| Metric | Status |
|---|---|
| Healthy | |
| Strong | |
| Strong | |
| Strong |
CAT's revenue, profitability, cash flow and balance sheet are all currently healthy.
DRS Fundamentals
| Metric | Status |
|---|---|
| Healthy | |
| Healthy | |
| Healthy | |
| Strong |
DRS's revenue, profitability, cash flow and balance sheet are all currently healthy.
CAT PE Valuation
| Level | PE | Price | Vs current |
|---|---|---|---|
| Cheap | 15x | $380 | -37% |
| Fair | 18x | $461 | -24% |
| Forward | 20x | $605 | — |
| Current | 24x | $605 | — |
| Expensive | 33x | $840 | +39% |
Historical ranges are pointers, not guarantees.
CAT has the edge over DRS in the historical PE scenario, which offers more potential upside but is not a forecast.
DRS PE Valuation
| Level | PE | Price | Vs current |
|---|---|---|---|
| Cheap | 9x | $12.28 | -66% |
| Forward | 24x | $35.66 | — |
| Current | 26x | $35.66 | — |
| Fair | 27x | $36.60 | +2.6% |
| Expensive | 43x | $58.75 | +65% |
Historical ranges are pointers, not guarantees.
DRS's PE is in its fair range at 26x. If earnings grow as analysts expect, today's price would be 24x next year's earnings.
CAT Forward outlook
| Metric | Outlook |
|---|---|
| Improving | |
| Strong growth | |
| Growth | |
| Strongly improving | |
| Moderate | |
| Low |
Analysts expect earnings and revenue growth for CAT, with profitability improving. However, they disagree widely on these estimates.
DRS Forward outlook
| Metric | Outlook |
|---|---|
| Improving | |
| Strong growth | |
| Growth | |
| Improving | |
| Limited | |
| Moderate |
Analysts expect earnings and revenue growth for DRS, with profitability improving.
CAT Earnings Per Share
| Quarter | TTM EPS | YoY |
|---|---|---|
| Forward | $30.32 | +19% |
| Q3 2026 | $25.48 | +31% |
| Q2 2026 | $23.23 | +18% |
| Q1 2026 | $20.08 | -2% |
| Q4 2025 | $18.81 | -15% |
| Q3 2025 | $19.46 | -9.7% |
| Q2 2025 | $19.64 | -10% |
| Q1 2025 | $20.50 | -7.4% |
| Q4 2024 | $22.05 | +9.6% |
CAT earned $25.48 per share over the past year, up 31% from the year before.
DRS Earnings Per Share
| Quarter | TTM EPS | YoY |
|---|---|---|
| Forward | $1.48 | +8.5% |
| Q3 2026 | $1.36 | +37% |
| Q2 2026 | $1.19 | +27% |
| Q1 2026 | $1.07 | +22% |
| Q4 2025 | $1.03 | +29% |
| Q3 2025 | $0.99 | +34% |
| Q2 2025 | $0.94 | +32% |
| Q1 2025 | $0.88 | +26% |
| Q4 2024 | $0.80 | +25% |
DRS has the edge over CAT on earnings, with more consistent year-over-year improvement.
CAT Quarterly Revenue
| Quarter | Revenue | YoY |
|---|---|---|
| Q3 2026 | $20.7B | +17% |
| Q2 2026 | $20.5B | +24% |
| Q1 2026 | $17.4B | +22% |
| Q4 2025 | $19.1B | +18% |
| Q3 2025 | $17.6B | +9.5% |
| Q2 2025 | $16.6B | -0.7% |
| Q1 2025 | $14.2B | -9.8% |
| Q4 2024 | $16.2B | -5% |
CAT's revenue has grown year over year for five quarters in a row: $20.7B last quarter, up 17% from the same quarter a year ago.
| Quarter | Margin | YoY |
|---|---|---|
| Q3 2026 | 20% | +3.1 points |
| Q2 2026 | 21% | +3.6 points |
| Q1 2026 | 18% | -0.4 points |
| Q4 2025 | 14% | -4.1 points |
| Q3 2025 | 17% | -2.2 points |
| Q2 2025 | 17% | -3.6 points |
| Q1 2025 | 18% | -4.2 points |
| Q4 2024 | 18% | -0.3 points |
CAT has the edge over DRS on profitability, with a higher operating margin.
DRS Quarterly Revenue
| Quarter | Revenue | YoY |
|---|---|---|
| Q3 2026 | $1.1B | +11% |
| Q2 2026 | $913M | +10% |
| Q1 2026 | $846M | +5.9% |
| Q4 2025 | $1.1B | +8.1% |
| Q3 2025 | $960M | +18% |
| Q2 2025 | $829M | +10% |
| Q1 2025 | $799M | +16% |
| Q4 2024 | $981M | +5.9% |
DRS's revenue has grown year over year for 14 quarters in a row: $1.1B last quarter, up 11% from the same quarter a year ago.
| Quarter | Margin | YoY |
|---|---|---|
| Q3 2026 | 11% | +1.2 points |
| Q2 2026 | 11% | +2.7 points |
| Q1 2026 | 9.1% | +1.7 points |
| Q4 2025 | 12% | -0.3 points |
| Q3 2025 | 9.7% | +0.4 points |
| Q2 2025 | 8.4% | +1.1 points |
| Q1 2025 | 7.4% | +1.1 points |
| Q4 2024 | 12% | +0.9 points |
DRS's operating margin was 11% last quarter, up 1.2 points from the same quarter a year ago.
CAT Free Cash Flow
| Quarter | Free cash flow | YoY |
|---|---|---|
| Q3 2026 | $3.7B | +19% |
| Q2 2026 | $3.8B | +47% |
| Q1 2026 | $1.1B | +97% |
| Q4 2025 | $2.7B | +0.1% |
| Q3 2025 | $3.1B | -1.5% |
| Q2 2025 | $2.6B | -4.2% |
| Q1 2025 | $579M | -63% |
| Q4 2024 | $2.7B | -22% |
CAT generated $11.3B in free cash flow over the past year, up 26% from the year before.
DRS Free Cash Flow
| Quarter | Free cash flow | YoY |
|---|---|---|
| Q3 2026 | $58M | -25% |
| Q2 2026 | $6M | +$62M |
| Q1 2026 | -$96M | +$74M |
| Q4 2025 | $376M | -9.2% |
| Q3 2025 | $77M | +64% |
| Q2 2025 | -$56M | -$56M |
| Q1 2025 | -$170M | +$105M |
| Q4 2024 | $414M | -17% |
DRS generated $344M in free cash flow over the past year, up 30% from the year before.
CAT Total Shares
| Period | Change % | Net change |
|---|---|---|
| Quarterly | -0.3% | -1.6M shares |
| 1 year | -2.1% | -9.9M shares |
| 3 years | -10% | -51.7M shares |
| 5 years | -16% | -86.7M shares |
| Available history | -19% | -107M shares |
CAT has the edge over DRS on shareholder dilution, with a more favorable share count trend.
| Quarter | Spent |
|---|---|
| Q3 2026 | $1.2B |
| Q2 2026 | $1.5B |
| Q1 2026 | $5B |
| Q4 2025 | $340M |
| Q3 2025 | $362M |
| Q2 2025 | $828M |
| Q1 2025 | $3.7B |
| Q4 2024 | $640M |
CAT spent $8.1B buying back its own shares over the past year, up 47% from the year before.
DRS Total Shares
| Period | Change % | Net change |
|---|---|---|
| Quarterly | -0.2% | -600K shares |
| 1 year | 0% | -100K shares |
| 3 years | +1.2% | +3.3M shares |
| 5 years | +85% | +123M shares |
| Available history | +85% | +123M shares |
DRS has 268M diluted shares, about the same as a year ago.
| Quarter | Spent |
|---|---|
| Q3 2026 | $12M |
| Q2 2026 | $12M |
| Q1 2026 | $4M |
| Q4 2025 | $11M |
| Q3 2025 | $10M |
| Q2 2025 | $11M |
| Q1 2025 | $3M |
| Q4 2024 | $15M |
DRS spent $39M buying back its own shares over the past year, about the same as the year before.
CAT Net Leverage
| Quarter | Net Leverage | Status |
|---|---|---|
| Q3 2026 | -0.5x | Net Cash |
| Q2 2026 | -0.4x | Net Cash |
| Q1 2026 | -0.3x | Net Cash |
| Q4 2025 | 2.0x | Healthy |
| Q3 2025 | -0.6x | Net Cash |
| Q2 2025 | -0.4x | Net Cash |
| Q1 2025 | -0.3x | Net Cash |
| Q4 2024 | 1.6x | Healthy |
CAT has the edge over DRS on leverage, with a lower net debt burden relative to earnings.
DRS Net Leverage
| Quarter | Net Leverage | Status |
|---|---|---|
| Q3 2026 | -0.2x | Net Cash |
| Q2 2026 | -0.2x | Net Cash |
| Q1 2026 | -0.4x | Net Cash |
| Q4 2025 | -0.7x | Net Cash |
| Q3 2025 | 0.1x | Very low |
| Q2 2025 | 0.2x | Very low |
| Q1 2025 | -0.0x | Net Cash |
| Q4 2024 | -0.6x | Net Cash |
DRS has more cash than debt.
CAT Weekly Momentum
| Metric | Value | Status |
|---|---|---|
| RSI | 32.7 | Neutral |
| Stochastic | 6.7 | Oversold |
CAT's weekly RSI is 33 (neutral) and its Stochastic is 7 (oversold).
DRS Weekly Momentum
| Metric | Value | Status |
|---|---|---|
| RSI | 41.9 | Neutral |
| Stochastic | 21.1 | Neutral |
DRS's weekly RSI is 42 (neutral) and its Stochastic is 21 (neutral).
CAT PE vs Industrials Sector
| Metric | CAT | Sector median | Relative |
|---|---|---|---|
| PE | 24x | 24x | 1.3% below |
| PE % | 69 | 58 | 11 pts above |
CAT has the edge over DRS on valuation relative to its sector.
DRS PE vs Industrials Sector
| Metric | DRS | Sector median | Relative |
|---|---|---|---|
| PE | 26x | 24x | 8.9% above |
| PE % | 49 | 58 | 9 pts below |
DRS is trading at 26x earnings, in line with the Industrials sector's median of 24x.
CAT Weekly Moving Averages
| Moving average | MA price | Relative |
|---|---|---|
| 8 week MA | $709.0 | 15% below |
| 20 week MA | $797.0 | 24% below |
| 50 week MA | $771.3 | 22% below |
| 100 week MA | $586.7 | 3.2% above |
| 200 week MA | $443.1 | 37% above |
CAT has the edge over DRS on trend strength, trading above more of its moving averages.
DRS Weekly Moving Averages
| Moving average | MA price | Relative |
|---|---|---|
| 8 week MA | $35.9 | 0.8% below |
| 20 week MA | $39.7 | 10% below |
| 50 week MA | $41.0 | 13% below |
| 100 week MA | $39.8 | 10% below |
| 200 week MA | $30.4 | 17% above |
DRS has fallen below most of its moving averages, though it's still 17% above its 200-week average.
CAT Yearly ROI
| Year | Start price | End price | ROI |
|---|---|---|---|
| 2020 | $148.3 | $179.6 | +21% |
| 2021 | $179.6 | $206.2 | +15% |
| 2022 | $206.2 | $239.9 | +16% |
| 2023 | $239.9 | $295.7 | +23% |
| 2024 | $295.7 | $364.9 | +23% |
| 2025 | $364.9 | $583.0 | +60% |
| 2026 YTD | $583.0 | $605.3 | +3.8% |
CAT has finished every year since 2020 higher, and it's up 3.8% so far in 2026.
DRS Yearly ROI
| Year | Start price | End price | ROI |
|---|---|---|---|
| 2020 | $5.35 | $10.3 | +92% |
| 2021 | $10.3 | $9.45 | -8% |
| 2022 | $9.45 | $13.2 | +39% |
| 2023 | $13.2 | $20.0 | +52% |
| 2024 | $20.0 | $32.5 | +62% |
| 2025 | $32.5 | $34.3 | +5.3% |
| 2026 YTD | $34.3 | $35.7 | +4% |
DRS has the edge over CAT on returns for 2026, with the stronger performance.