CAT vs MSFT: Which Is the Better Buy?
Side-by-side comparison of Caterpillar Inc. and Microsoft Corporation — fair value, conviction, valuation metrics, and QuantHub research signals.
Updated 2026-05-13.
Caterpillar Inc. · Industrials
$912.14
-47.9% upside to fair value
Grade D
High Quality
VS
Microsoft Corporation · Technology
$429.25
-1.3% upside to fair value
Grade B
High Quality
QuantHub Verdict
MSFT has more upside to fair value
(-1.3%).
MSFT trades at a lower forward P/E
(26.8x).
These are model outputs — not personalized investment advice.
See all research →
Valuation & Fundamentals
| Metric |
CAT |
MSFT |
| Current Price |
$912.14 |
$429.25 |
| Fair Value Estimate |
$475.00 |
$423.82 |
| Upside to Fair Value |
-47.9%
|
-1.3%
|
| Market Cap |
$420.2B |
$3,187.4B |
| Forward P/E |
44.9x
|
26.8x
|
| EV / EBITDA |
30.0x
|
17.2x
|
| Price / Sales |
5.9x
|
10.4x
|
| Price / FCF |
36.7x
|
41.2x
|
| Revenue Growth YoY |
+22.2%
|
+16.7%
|
| Gross Margin |
32.5%
|
68.6%
|
| Operating Margin |
16.6%
|
46.7%
|
| Return on Equity |
47.5%
|
33.6%
|
| Dividend Yield |
1.5% |
0% |
| FCF Yield |
2.73%
|
2.43%
|
| Analyst Consensus |
Hold
|
Strong Buy
|
Investment Thesis
Caterpillar is the world's leading manufacturer of construction and mining equipment, with diversified revenue across Construction Industries, Resource Industries, Energy & Transportation, and Cat Financial. Q1 2026 results reported April 30 showed revenue of $17.4 billion (+22.2% YoY) and EPS of $5.50 (+30.3% YoY), driven by powerful demand from data center build-outs (large engine and power gen…
Microsoft Corporation is a leading technology company specializing in software infrastructure, cloud computing, and productivity solutions. The company benefits from a high-quality business model characterized by durable competitive moats including strong switching costs and intangible assets such as its brand and cloud infrastructure. Under CEO Satya Nadella's leadership since 2014, Microsoft ha…
Accumulation Zones
| Metric |
CAT |
MSFT |
| Zone Low |
$356.00 |
$317.87 |
| Zone High |
$404.00 |
$360.25 |
| In Buy Zone? |
No
|
No
|