Dobermans of the Dow: 10 Stocks to Consider

6. Caterpillar Inc. (NYSE:CAT)

Free Cash Flow Yield: 0.05

Number of Hedge Fund Holders: 62

Caterpillar Inc. (NYSE:CAT) is an American manufacturing company that specializes in construction, mining, and other engineering equipment. Building on its long-standing tradition of innovation, the company has intensified efforts to integrate advanced technology and digital connectivity across its product lineup. Its strategy to expand autonomous solutions, electrified powertrains, and AI-driven capabilities has contributed to business diversification.

In the fourth quarter of 2024, Caterpillar Inc. (NYSE:CAT) reported revenue of $16.2 billion, reflecting a 5% year-over-year decline. The decrease was primarily due to an $859 million drop in sales volume, driven by shifts in dealer inventories and lower equipment sales to end users. Dealer inventory levels declined by $1.3 billion during the quarter, a sharper reduction compared to the $900 million decrease recorded in the fourth quarter of 2023. Despite the revenue dip, profit per share increased to $5.78, up from $5.28 in the same period the previous year.

Caterpillar Inc. (NYSE:CAT) offers a quarterly dividend of $1.41 per share and has a dividend yield of 1.63%, as recorded on March 10. The company maintained a strong financial position in 2024, generating $12.0 billion in operating cash flow over the year and closing the fourth quarter with $6.9 billion in cash. Throughout the year, the company allocated $7.7 billion to share repurchases and distributed $2.6 billion in dividends to shareholders. This strong cash position has enabled the company to raise its payouts for 30 consecutive years.