See attached file.

1. Company-
Caterpillar INC
Ticker Name- NYSE - CAT
Current Share price - $ 144.49 (As on 2nd November, 2019) (Source – Thomson Reuters)2
Industry- Heavy machinery and Vehicles
Description – It is a manufacturer of construction equipment, engines, and diesel locomotives. The Company operates through segments, including Construction Industries, which is engaged in supporting customers using machinery in infrastructure, forestry and building construction; Resource Industries, which is engaged in supporting customers using machinery in mining, quarry, waste and material handling applications; Energy & Transportation, which supports customers in oil and gas, power generation, marine, rail and industrial applications, including Cat machines; Financial Products segment, which provides financing and related services, and All Other operating segments, which includes activities, such as product management and development, and manufacturing of filters and fluids, undercarriage, tires and rims, ground engaging tools, fluid transfer products, and sealing and connecting components for Cat products.
2. Operational Risks8-
Competition Risk – Due to high competition in the markets, the firm might not be able to pass on the increased costs of the raw material to customers to maintain the market share.
Quality Risk – risk of the products not meeting the quality standards required by the regulators as well as the customers.
Inventory management risk- Needs to ensure that supply and demand requirements are met and no excess capital is tied up in the inventory and finished goods. Supplier’s risk- Due to having sourced multiple products from the suppliers/OEMs, we have an additional risk from the suppliers for the procurements.
3.Financial Risks-
Debt to Equity Ratio – 253.52%
Total Debt = $ 37,906 M
Total Equity = $ 14,952 M
The biggest threat that Caterpillar is facing, is its financial risk. It is a capital intensive business and to boost shareholder value, the firm takes enormous amount of debt.
Interest Rate Risk-
Due to being heavily leveraged, Caterpillar has been exposed to significant risk of adverse movements in the interest rate, as this will impact the bottom-line adversely.
Credit Rating Risk-
Any credit rating downgrade, would increase the cost of debt for the firm and subsequently increase the cost of equity.
Foreign Exchange risk-
Any adverse movements in the currency of foreign countries, where Caterpillar is operating or has business will lead to significant exchange losses to the firm.
4. Preferred stock
The firm does not have any preferred stock.
Preferred stock has both the characteristics of the debt to equity and its claim to the assets in the event of bankruptcy, also lies between the bondholders and shareholders.10 the firm has not been able to allot any preference shares due to its higher cost than the debt and continuous outflow in the form of dividends.
5. Capital Structure of the Company 8–
As far as the capital structure of the firm is concerned, the firm has almost 38 billion dollars’ worth of short term and long term debt. Majorly the long term debt is there. Very small portion is the minority interest which shows very few intercompany investments and transactions. Firm’s market capital is 80 billion dollars.
    Capital Structure
    
    
    Source of Funds
    (in USD Millions)
    Short term Borrowings
    4,268
    Current Long Term...