CUMMINS INC (CMI) Fundamental Analysis & Valuation

NYSE:CMI • US2310211063

568.62 USD
+18.43 (+3.35%)
Last: Mar 10, 2026, 01:28 PM
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This CMI fundamental analysis includes valuation metrics, fair value assessment, financial health analysis, profitability trends, growth metrics and dividend sustainability analysis.

Fundamental Rating

5

Taking everything into account, CMI scores 5 out of 10 in our fundamental rating. CMI was compared to 131 industry peers in the Machinery industry. CMI has an excellent profitability rating, but there are some minor concerns on its financial health. CMI is quite expensive at the moment. It does show a decent growth rate. Finally CMI also has an excellent dividend rating. This makes CMI very considerable for dividend investing!


Dividend Valuation Growth Profitability Health

7

1. CMI Profitability Analysis

1.1 Basic Checks

  • CMI had positive earnings in the past year.
  • CMI had a positive operating cash flow in the past year.
  • CMI had positive earnings in each of the past 5 years.
  • Each year in the past 5 years CMI had a positive operating cash flow.
CMI Yearly Net Income VS EBIT VS OCF VS FCFCMI Yearly Net Income VS EBIT VS OCF VS FCFYearly Net Income VS EBIT VS OCF VS FCF 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 1B 2B 3B 4B

1.2 Ratios

  • CMI has a Return On Assets of 8.36%. This is in the better half of the industry: CMI outperforms 76.34% of its industry peers.
  • CMI has a Return On Equity of 23.02%. This is amongst the best in the industry. CMI outperforms 90.08% of its industry peers.
  • The Return On Invested Capital of CMI (12.12%) is better than 80.92% of its industry peers.
  • CMI had an Average Return On Invested Capital over the past 3 years of 12.81%. This is above the industry average of 10.16%.
Industry RankSector Rank
ROA 8.36%
ROE 23.02%
ROIC 12.12%
ROA(3y)7.72%
ROA(5y)7.85%
ROE(3y)23.25%
ROE(5y)23.77%
ROIC(3y)12.81%
ROIC(5y)11.69%
CMI Yearly ROA, ROE, ROICCMI Yearly ROA, ROE, ROICYearly ROA, ROE, ROIC 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 10 20 30

1.3 Margins

  • CMI's Profit Margin of 8.44% is fine compared to the rest of the industry. CMI outperforms 67.94% of its industry peers.
  • In the last couple of years the Profit Margin of CMI has remained more or less at the same level.
  • CMI has a Operating Margin (11.45%) which is comparable to the rest of the industry.
  • CMI's Operating Margin has improved in the last couple of years.
  • CMI's Gross Margin of 25.29% is on the low side compared to the rest of the industry. CMI is outperformed by 64.12% of its industry peers.
  • In the last couple of years the Gross Margin of CMI has remained more or less at the same level.
Industry RankSector Rank
OM 11.45%
PM (TTM) 8.44%
GM 25.29%
OM growth 3Y7.51%
OM growth 5Y5.11%
PM growth 3Y3.29%
PM growth 5Y-1.33%
GM growth 3Y2.38%
GM growth 5Y0.83%
CMI Yearly Profit, Operating, Gross MarginsCMI Yearly Profit, Operating, Gross MarginsYearly Profit, Operating, Gross Margins 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 5 10 15 20 25

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ROAROEROICOperating and Profit MarginShow most profitable peers

5

2. CMI Health Analysis

2.1 Basic Checks

  • CMI has a Return on Invested Capital (ROIC), which is just above the Cost of Capital (WACC), which means it is creating some value.
  • The number of shares outstanding for CMI has been increased compared to 1 year ago.
  • Compared to 5 years ago, CMI has less shares outstanding
  • Compared to 1 year ago, CMI has an improved debt to assets ratio.
CMI Yearly Shares OutstandingCMI Yearly Shares OutstandingYearly Shares Outstanding 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 50M 100M 150M
CMI Yearly Total Debt VS Total AssetsCMI Yearly Total Debt VS Total AssetsYearly Total Debt VS Total Assets 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 10B 20B 30B

2.2 Solvency

  • An Altman-Z score of 4.66 indicates that CMI is not in any danger for bankruptcy at the moment.
  • CMI has a better Altman-Z score (4.66) than 70.23% of its industry peers.
  • CMI has a debt to FCF ratio of 3.17. This is a good value and a sign of high solvency as CMI would need 3.17 years to pay back of all of its debts.
  • Looking at the Debt to FCF ratio, with a value of 3.17, CMI is in the better half of the industry, outperforming 67.94% of the companies in the same industry.
  • A Debt/Equity ratio of 0.60 indicates that CMI is somewhat dependend on debt financing.
  • Looking at the Debt to Equity ratio, with a value of 0.60, CMI is doing worse than 61.07% of the companies in the same industry.
Industry RankSector Rank
Debt/Equity 0.6
Debt/FCF 3.17
Altman-Z 4.66
ROIC/WACC1.32
WACC9.19%
CMI Yearly LT Debt VS Equity VS FCFCMI Yearly LT Debt VS Equity VS FCFYearly LT Debt VS Equity VS FCF 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2B 4B 6B 8B 10B

2.3 Liquidity

  • CMI has a Current Ratio of 1.76. This is a normal value and indicates that CMI is financially healthy and should not expect problems in meeting its short term obligations.
  • CMI's Current ratio of 1.76 is on the low side compared to the rest of the industry. CMI is outperformed by 62.60% of its industry peers.
  • A Quick Ratio of 1.16 indicates that CMI should not have too much problems paying its short term obligations.
  • CMI has a Quick ratio (1.16) which is comparable to the rest of the industry.
Industry RankSector Rank
Current Ratio 1.76
Quick Ratio 1.16
CMI Yearly Current Assets VS Current LiabilitesCMI Yearly Current Assets VS Current LiabilitesYearly Current Assets VS Current Liabilites 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 5B 10B 15B

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WACCDebt/EquityHow to determine the health of a companyAltman-Z scoreShow peers with great health

5

3. CMI Growth Analysis

3.1 Past

  • CMI shows a small growth in Earnings Per Share. In the last year, the EPS has grown by 4.17%.
  • Measured over the past years, CMI shows a quite strong growth in Earnings Per Share. The EPS has been growing by 13.03% on average per year.
  • Looking at the last year, CMI shows a decrease in Revenue. The Revenue has decreased by -1.27% in the last year.
  • CMI shows quite a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 11.19% yearly.
EPS 1Y (TTM)4.17%
EPS 3Y11.09%
EPS 5Y13.03%
EPS Q2Q%-16.93%
Revenue 1Y (TTM)-1.27%
Revenue growth 3Y6.25%
Revenue growth 5Y11.19%
Sales Q2Q%1.05%

3.2 Future

  • Based on estimates for the next years, CMI will show a quite strong growth in Earnings Per Share. The EPS will grow by 16.27% on average per year.
  • Based on estimates for the next years, CMI will show a quite strong growth in Revenue. The Revenue will grow by 8.57% on average per year.
EPS Next Y18.82%
EPS Next 2Y19.04%
EPS Next 3Y17.47%
EPS Next 5Y16.27%
Revenue Next Year7.07%
Revenue Next 2Y7.81%
Revenue Next 3Y7.87%
Revenue Next 5Y8.57%

3.3 Evolution

  • The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
  • The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
CMI Yearly Revenue VS EstimatesCMI Yearly Revenue VS EstimatesYearly Revenue VS Estimates 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 10B 20B 30B 40B 50B
CMI Yearly EPS VS EstimatesCMI Yearly EPS VS EstimatesYearly EPS VS Estimates 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 10 20 30 40

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3

4. CMI Valuation Analysis

4.1 Price/Earnings Ratio

  • The Price/Earnings ratio is 25.56, which means the current valuation is very expensive for CMI.
  • CMI's Price/Earnings is on the same level as the industry average.
  • When comparing the Price/Earnings ratio of CMI to the average of the S&P500 Index (26.45), we can say CMI is valued inline with the index average.
  • A Price/Forward Earnings ratio of 21.51 indicates a rather expensive valuation of CMI.
  • The rest of the industry has a similar Price/Forward Earnings ratio as CMI.
  • Compared to an average S&P500 Price/Forward Earnings ratio of 24.65, CMI is valued at the same level.
Industry RankSector Rank
PE 25.56
Fwd PE 21.51
CMI Price Earnings VS Forward Price EarningsCMI Price Earnings VS Forward Price Earnings ChartPrice Earnings - Forward Price Earnings PE FPE 5 10 15 20 25

4.2 Price Multiples

  • CMI's Enterprise Value to EBITDA ratio is in line with the industry average.
  • CMI's Price/Free Cash Flow ratio is in line with the industry average.
Industry RankSector Rank
P/FCF 32.93
EV/EBITDA 15.84
CMI Per share dataCMI EPS, Sales, OCF, FCF, BookValue per sharePer Share Data Per Share 50 100 150 200

4.3 Compensation for Growth

  • CMI's PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
  • The decent profitability rating of CMI may justify a higher PE ratio.
  • A more expensive valuation may be justified as CMI's earnings are expected to grow with 17.47% in the coming years.
PEG (NY)1.36
PEG (5Y)1.96
EPS Next 2Y19.04%
EPS Next 3Y17.47%

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Price/EarningsPrice/FCFFCF per shareEV/EBITDAPEG RATIOShow best valued peers

7

5. CMI Dividend Analysis

5.1 Amount

  • CMI has a Yearly Dividend Yield of 1.44%.
  • CMI's Dividend Yield is rather good when compared to the industry average which is at 1.13. CMI pays more dividend than 81.68% of the companies in the same industry.
  • Compared to the average S&P500 Dividend Yield of 1.82, CMI is paying slightly less dividend.
Industry RankSector Rank
Dividend Yield 1.44%

5.2 History

  • The dividend of CMI is nicely growing with an annual growth rate of 7.87%!
  • CMI has been paying a dividend for at least 10 years, so it has a reliable track record.
  • CMI has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)7.87%
Div Incr Years19
Div Non Decr Years20
CMI Yearly Dividends per shareCMI Yearly Dividends per shareYearly Dividends per share 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2 4 6

5.3 Sustainability

  • CMI pays out 37.11% of its income as dividend. This is a sustainable payout ratio.
  • CMI's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP37.11%
EPS Next 2Y19.04%
EPS Next 3Y17.47%
CMI Yearly Income VS Free CF VS DividendCMI Yearly Income VS Free CF VS DividendYearly Income VS Free CF VS Dividend 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 1B 2B 3B
CMI Dividend Payout.CMI Dividend Payout, showing the Payout Ratio.CMI Dividend Payout.PayoutRetained Earnings

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CMI Fundamentals: All Metrics, Ratios and Statistics

CUMMINS INC

NYSE:CMI (3/10/2026, 1:28:06 PM)

568.62

+18.43 (+3.35%)

Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryMachinery
Earnings (Last)02-05
Earnings (Next)05-04
Inst Owners87.15%
Inst Owner Change2.91%
Ins Owners0.29%
Ins Owner Change3.83%
Market Cap78.57B
Revenue(TTM)33.67B
Net Income(TTM)2.84B
Analysts75.56
Price Target626.16 (10.12%)
Short Float %1.1%
Short Ratio1.56
Dividend
Industry RankSector Rank
Dividend Yield 1.44%
Yearly Dividend7.66
Dividend Growth(5Y)7.87%
DP37.11%
Div Incr Years19
Div Non Decr Years20
Ex-Date02-20
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)-1.11%
Min EPS beat(2)-17.22%
Max EPS beat(2)15.01%
EPS beat(4)3
Avg EPS beat(4)10.55%
Min EPS beat(4)-17.22%
Max EPS beat(4)24.03%
EPS beat(8)6
Avg EPS beat(8)9.81%
EPS beat(12)7
Avg EPS beat(12)6.12%
EPS beat(16)9
Avg EPS beat(16)3.34%
Revenue beat(2)2
Avg Revenue beat(2)3.64%
Min Revenue beat(2)3.3%
Max Revenue beat(2)3.98%
Revenue beat(4)3
Avg Revenue beat(4)1.88%
Min Revenue beat(4)-1.21%
Max Revenue beat(4)3.98%
Revenue beat(8)6
Avg Revenue beat(8)1.87%
Revenue beat(12)10
Avg Revenue beat(12)2.19%
Revenue beat(16)14
Avg Revenue beat(16)2.82%
PT rev (1m)10.63%
PT rev (3m)18.91%
EPS NQ rev (1m)2.41%
EPS NQ rev (3m)2.08%
EPS NY rev (1m)-0.85%
EPS NY rev (3m)0.1%
Revenue NQ rev (1m)3.31%
Revenue NQ rev (3m)3.57%
Revenue NY rev (1m)1.41%
Revenue NY rev (3m)1.57%
Valuation
Industry RankSector Rank
PE 25.56
Fwd PE 21.51
P/S 2.33
P/FCF 32.93
P/OCF 21.7
P/B 6.36
P/tB 9.87
EV/EBITDA 15.84
EPS(TTM)22.25
EY3.91%
EPS(NY)26.44
Fwd EY4.65%
FCF(TTM)17.27
FCFY3.04%
OCF(TTM)26.21
OCFY4.61%
SpS243.69
BVpS89.38
TBVpS57.6
PEG (NY)1.36
PEG (5Y)1.96
Graham Number211.53
Profitability
Industry RankSector Rank
ROA 8.36%
ROE 23.02%
ROCE 15.81%
ROIC 12.12%
ROICexc 14.16%
ROICexgc 17.81%
OM 11.45%
PM (TTM) 8.44%
GM 25.29%
FCFM 7.09%
ROA(3y)7.72%
ROA(5y)7.85%
ROE(3y)23.25%
ROE(5y)23.77%
ROIC(3y)12.81%
ROIC(5y)11.69%
ROICexc(3y)14.66%
ROICexc(5y)13.52%
ROICexgc(3y)19.32%
ROICexgc(5y)17.59%
ROCE(3y)17.34%
ROCE(5y)15.93%
ROICexgc growth 3Y7.12%
ROICexgc growth 5Y6.4%
ROICexc growth 3Y9.89%
ROICexc growth 5Y5.61%
OM growth 3Y7.51%
OM growth 5Y5.11%
PM growth 3Y3.29%
PM growth 5Y-1.33%
GM growth 3Y2.38%
GM growth 5Y0.83%
F-Score5
Asset Turnover0.99
Health
Industry RankSector Rank
Debt/Equity 0.6
Debt/FCF 3.17
Debt/EBITDA 1.5
Cap/Depr 111.77%
Cap/Sales 3.67%
Interest Coverage 12.51
Cash Conversion 73.02%
Profit Quality 83.93%
Current Ratio 1.76
Quick Ratio 1.16
Altman-Z 4.66
F-Score5
WACC9.19%
ROIC/WACC1.32
Cap/Depr(3y)114.55%
Cap/Depr(5y)115.84%
Cap/Sales(3y)3.59%
Cap/Sales(5y)3.46%
Profit Quality(3y)155.19%
Profit Quality(5y)116.63%
High Growth Momentum
Growth
EPS 1Y (TTM)4.17%
EPS 3Y11.09%
EPS 5Y13.03%
EPS Q2Q%-16.93%
EPS Next Y18.82%
EPS Next 2Y19.04%
EPS Next 3Y17.47%
EPS Next 5Y16.27%
Revenue 1Y (TTM)-1.27%
Revenue growth 3Y6.25%
Revenue growth 5Y11.19%
Sales Q2Q%1.05%
Revenue Next Year7.07%
Revenue Next 2Y7.81%
Revenue Next 3Y7.87%
Revenue Next 5Y8.57%
EBIT growth 1Y5.19%
EBIT growth 3Y14.23%
EBIT growth 5Y16.87%
EBIT Next Year42.53%
EBIT Next 3Y20.49%
EBIT Next 5Y17.49%
FCF growth 1Y755.2%
FCF growth 3Y31.64%
FCF growth 5Y2.13%
OCF growth 1Y143.51%
OCF growth 3Y22.66%
OCF growth 5Y5.87%

CUMMINS INC / CMI FAQ

What is the ChartMill fundamental rating of CUMMINS INC (CMI) stock?

ChartMill assigns a fundamental rating of 6 / 10 to CMI.


What is the valuation status of CUMMINS INC (CMI) stock?

ChartMill assigns a valuation rating of 4 / 10 to CUMMINS INC (CMI). This can be considered as Fairly Valued.


What is the profitability of CMI stock?

CUMMINS INC (CMI) has a profitability rating of 7 / 10.


What are the PE and PB ratios of CUMMINS INC (CMI) stock?

The Price/Earnings (PE) ratio for CUMMINS INC (CMI) is 25.56 and the Price/Book (PB) ratio is 6.36.


Can you provide the dividend sustainability for CMI stock?

The dividend rating of CUMMINS INC (CMI) is 7 / 10 and the dividend payout ratio is 37.11%.