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CAT's Record $78B Backlog Signals Strength: Can Growth Continue?
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Key Takeaways
Caterpillar's record $78B backlog nearly doubled year over year, with 58% slated for delivery within 12 months
CAT targets nearly tripling large engine capacity and its autonomous truck fleet by 2030 to support demand.
CAT projects mid-to-high teens revenue growth in 2026, backed by strong orders and capacity expansions.
Caterpillar Inc. (CAT - Free Report) exited the third quarter of 2026 with a record order backlog of $78 billion, reflecting robust demand across its businesses and providing solid revenue visibility for the coming quarters. The company's backlog nearly doubled from the year-ago level, underscoring sustained customer spending on construction, mining and power generation equipment. This strong order momentum, coupled with expanding production capacity and investments in advanced technologies, positions Caterpillar well to capitalize on emerging growth opportunities.
Approximately 58% of the backlog is expected to be delivered over the next 12 months. This proportion has remained relatively consistent over the past three quarters, indicating steady order conversion expectations and providing greater visibility into future revenues.
The robust order book also reinforces management's improved outlook for 2026. Caterpillar now anticipates sales and revenues to increase in the mid-to-high teens percentage range from the 2025 level.
Caterpillar stands to benefit from several structural growth opportunities, including increased U.S. infrastructure investments, mining activities associated with the energy transition, automation, data center development and rising power generation requirements. The company is also strengthening its competitive position through investments in services, e-commerce, sustainability, electrification and digital solutions.
To address growing demand in its Power & Energy business, Caterpillar is focusing on expanding production capacity while optimizing existing manufacturing infrastructure. The company plans to repurpose a portion of its Winston-Salem, NC, facility, which currently manufactures locomotive engines, into a second assembly and testing location for its 3600 Series large reciprocating engines. The initiative is aimed at meeting increasing natural gas compression demand and supports Caterpillar's target of nearly tripling its large reciprocating engine capacity by 2030 compared with 2024.
Additionally, Caterpillar announced a $1 billion investment to expand manufacturing operations in Sanford, NC, to boost the production of compact track loaders and telehandlers. The expansion will leverage advanced manufacturing technologies, automation and digital production systems to enhance operational efficiency, product quality and workplace safety.
In Resource Industries, Caterpillar continues to expand its presence in autonomous equipment solutions. The company is extending its autonomous hauling collaboration with Luck Stone to two additional operations in Virginia, following a successful pilot at Bull Run Quarry. Since November 2024, autonomous trucks at the site have transported more than 3.5 million tons of material.
The expansion will also introduce Caterpillar's autonomous technology on a Cat 775 truck for the first time, broadening its application beyond large-scale mining operations into the quarry and aggregates market. This development aligns with the company's objective of tripling its autonomous truck fleet by 2030 from the 2024 level.
CAT's Industry Peers Witness Healthy Backlog Growth
Terex Corporation (TEX - Free Report) exited the third quarter of 2026 with an order backlog of $7 billion, up $802 million, or 12.9%, year over year on a pro forma basis. The improvement was driven by higher bookings across its segments. Total bookings surged 52.7% year over year on a pro forma basis to $2.3 billion, resulting in a book-to-bill ratio of 103%.
Astec Industries (ASTE - Free Report) also witnessed significant order book expansion, with its backlog jumping 49.2% year over year to $670.5 million at the end of the third quarter of 2026. The increase points to healthy demand for its equipment across key end markets.
The Materials Solutions segment's backlog increased 52.1% year over year to $289 million, while the Infrastructure Solutions segment recorded a 47% increase to $381.5 million. The book-to-bill ratios for Materials Solutions and Infrastructure Solutions stood at 86% and 149%, respectively.
Although Terex and Astec operate on a much smaller scale than Caterpillar, their expanding order books indicate continued customer investments in construction and infrastructure equipment. This broader industry momentum, along with Caterpillar's record backlog, capacity expansion initiatives and technological advancements, provides a favorable foundation for sustained growth, even amid ongoing economic uncertainties.
CAT’s Price Performance, Valuation & Estimates
CAT shares have declined 33.1% over the past six months compared with the industry’s 34.8% drop.
Image Source: Zacks Investment Research
Caterpillar is currently trading at a forward 12-month price/earnings (P/E) ratio of 18.21X compared with the industry average of 17.02X.
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for CAT’s 2026 earnings indicates year-over-year growth of 43.7%. The consensus mark for revenues implies an increase of 17.4% for the year. The earnings estimate for 2027 indicates a 19.9% growth, with revenues rising 11.1%.
Image Source: Zacks Investment Research
Earnings estimates for Caterpillar for 2026 have moved up over the past 60 days, while the same for 2027 has moved down.
View the Zacks #1 Rank List
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CAT's Record $78B Backlog Signals Strength: Can Growth Continue?
Key Takeaways
Caterpillar Inc. (CAT - Free Report) exited the third quarter of 2026 with a record order backlog of $78 billion, reflecting robust demand across its businesses and providing solid revenue visibility for the coming quarters. The company's backlog nearly doubled from the year-ago level, underscoring sustained customer spending on construction, mining and power generation equipment. This strong order momentum, coupled with expanding production capacity and investments in advanced technologies, positions Caterpillar well to capitalize on emerging growth opportunities.
Approximately 58% of the backlog is expected to be delivered over the next 12 months. This proportion has remained relatively consistent over the past three quarters, indicating steady order conversion expectations and providing greater visibility into future revenues.
The robust order book also reinforces management's improved outlook for 2026. Caterpillar now anticipates sales and revenues to increase in the mid-to-high teens percentage range from the 2025 level.
Caterpillar stands to benefit from several structural growth opportunities, including increased U.S. infrastructure investments, mining activities associated with the energy transition, automation, data center development and rising power generation requirements. The company is also strengthening its competitive position through investments in services, e-commerce, sustainability, electrification and digital solutions.
To address growing demand in its Power & Energy business, Caterpillar is focusing on expanding production capacity while optimizing existing manufacturing infrastructure. The company plans to repurpose a portion of its Winston-Salem, NC, facility, which currently manufactures locomotive engines, into a second assembly and testing location for its 3600 Series large reciprocating engines. The initiative is aimed at meeting increasing natural gas compression demand and supports Caterpillar's target of nearly tripling its large reciprocating engine capacity by 2030 compared with 2024.
Additionally, Caterpillar announced a $1 billion investment to expand manufacturing operations in Sanford, NC, to boost the production of compact track loaders and telehandlers. The expansion will leverage advanced manufacturing technologies, automation and digital production systems to enhance operational efficiency, product quality and workplace safety.
In Resource Industries, Caterpillar continues to expand its presence in autonomous equipment solutions. The company is extending its autonomous hauling collaboration with Luck Stone to two additional operations in Virginia, following a successful pilot at Bull Run Quarry. Since November 2024, autonomous trucks at the site have transported more than 3.5 million tons of material.
The expansion will also introduce Caterpillar's autonomous technology on a Cat 775 truck for the first time, broadening its application beyond large-scale mining operations into the quarry and aggregates market. This development aligns with the company's objective of tripling its autonomous truck fleet by 2030 from the 2024 level.
CAT's Industry Peers Witness Healthy Backlog Growth
Terex Corporation (TEX - Free Report) exited the third quarter of 2026 with an order backlog of $7 billion, up $802 million, or 12.9%, year over year on a pro forma basis. The improvement was driven by higher bookings across its segments. Total bookings surged 52.7% year over year on a pro forma basis to $2.3 billion, resulting in a book-to-bill ratio of 103%.
Astec Industries (ASTE - Free Report) also witnessed significant order book expansion, with its backlog jumping 49.2% year over year to $670.5 million at the end of the third quarter of 2026. The increase points to healthy demand for its equipment across key end markets.
The Materials Solutions segment's backlog increased 52.1% year over year to $289 million, while the Infrastructure Solutions segment recorded a 47% increase to $381.5 million. The book-to-bill ratios for Materials Solutions and Infrastructure Solutions stood at 86% and 149%, respectively.
Although Terex and Astec operate on a much smaller scale than Caterpillar, their expanding order books indicate continued customer investments in construction and infrastructure equipment. This broader industry momentum, along with Caterpillar's record backlog, capacity expansion initiatives and technological advancements, provides a favorable foundation for sustained growth, even amid ongoing economic uncertainties.
CAT’s Price Performance, Valuation & Estimates
CAT shares have declined 33.1% over the past six months compared with the industry’s 34.8% drop.
Image Source: Zacks Investment Research
Caterpillar is currently trading at a forward 12-month price/earnings (P/E) ratio of 18.21X compared with the industry average of 17.02X.
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for CAT’s 2026 earnings indicates year-over-year growth of 43.7%. The consensus mark for revenues implies an increase of 17.4% for the year. The earnings estimate for 2027 indicates a 19.9% growth, with revenues rising 11.1%.
Image Source: Zacks Investment Research
Earnings estimates for Caterpillar for 2026 have moved up over the past 60 days, while the same for 2027 has moved down.
Image Source: Zacks Investment Research
Caterpillar stock currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.