CUMMINS INC (CMI) Stock Fundamental Analysis
USA - NYSE:CMI - US2310211063 - Common Stock
473.84 USD
+8.92 (+1.92%)
CMI gets a fundamental rating of 5 out of 10. The analysis compared the fundamentals against 130 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. CMI also has an excellent dividend rating. These ratings would make CMI suitable for dividend investing!
1. Profitability
1.1 Basic Checks
In the past year CMI was profitable.
In the past year CMI had a positive cash flow from operations.
In the past 5 years CMI has always been profitable.
Each year in the past 5 years CMI had a positive operating cash flow.
1.2 Ratios
Looking at the Return On Assets, with a value of 7.93%, CMI is in the better half of the industry, outperforming 75.38% of the companies in the same industry.
Looking at the Return On Equity, with a value of 22.12%, CMI belongs to the top of the industry, outperforming 88.46% of the companies in the same industry.
CMI has a better Return On Invested Capital (10.92%) than 76.15% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for CMI is in line with the industry average of 10.24%.
The 3 year average ROIC (10.13%) for CMI is below the current ROIC(10.92%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.93% | ||
| ROE | 22.12% | ||
| ROIC | 10.92% |
ROA(3y)7.3%
ROA(5y)7.76%
ROE(3y)23.56%
ROE(5y)23.61%
ROIC(3y)10.13%
ROIC(5y)9.3%
1.3 Margins
The Profit Margin of CMI (7.94%) is better than 64.62% of its industry peers.
CMI's Profit Margin has improved in the last couple of years.
With a decent Operating Margin value of 12.01%, CMI is doing good in the industry, outperforming 61.54% of the companies in the same industry.
In the last couple of years the Operating Margin of CMI has remained more or less at the same level.
The Gross Margin of CMI (25.94%) is worse than 62.31% of its industry peers.
CMI's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 12.01% | ||
| PM (TTM) | 7.94% | ||
| GM | 25.94% |
OM growth 3Y5.37%
OM growth 5Y0.23%
PM growth 3Y9.26%
PM growth 5Y3.83%
GM growth 3Y1.89%
GM growth 5Y-0.23%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) just above the Cost of Capital (WACC), CMI is creating some value.
Compared to 1 year ago, CMI has less shares outstanding
The number of shares outstanding for CMI has been reduced compared to 5 years ago.
Compared to 1 year ago, CMI has a worse debt to assets ratio.
2.2 Solvency
CMI has an Altman-Z score of 4.36. This indicates that CMI is financially healthy and has little risk of bankruptcy at the moment.
With a decent Altman-Z score value of 4.36, CMI is doing good in the industry, outperforming 70.77% of the companies in the same industry.
CMI has a debt to FCF ratio of 3.34. This is a good value and a sign of high solvency as CMI would need 3.34 years to pay back of all of its debts.
With a decent Debt to FCF ratio value of 3.34, CMI is doing good in the industry, outperforming 66.92% of the companies in the same industry.
CMI has a Debt/Equity ratio of 0.62. This is a neutral value indicating CMI is somewhat dependend on debt financing.
Looking at the Debt to Equity ratio, with a value of 0.62, CMI is doing worse than 61.54% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.62 | ||
| Debt/FCF | 3.34 | ||
| Altman-Z | 4.36 |
ROIC/WACC1.18
WACC9.27%
2.3 Liquidity
CMI has a Current Ratio of 1.77. This is a normal value and indicates that CMI is financially healthy and should not expect problems in meeting its short term obligations.
The Current ratio of CMI (1.77) is worse than 63.08% of its industry peers.
CMI has a Quick Ratio of 1.11. This is a normal value and indicates that CMI is financially healthy and should not expect problems in meeting its short term obligations.
With a Quick ratio value of 1.11, CMI perfoms like the industry average, outperforming 40.77% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.77 | ||
| Quick Ratio | 1.11 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an nice 14.51% over the past year.
Measured over the past 5 years, CMI shows a small growth in Earnings Per Share. The EPS has been growing by 7.79% on average per year.
Looking at the last year, CMI shows a decrease in Revenue. The Revenue has decreased by -1.80% in the last year.
Measured over the past years, CMI shows a small growth in Revenue. The Revenue has been growing by 7.67% on average per year.
EPS 1Y (TTM)14.51%
EPS 3Y13.63%
EPS 5Y7.79%
EPS Q2Q%-4.61%
Revenue 1Y (TTM)-1.8%
Revenue growth 3Y12.39%
Revenue growth 5Y7.67%
Sales Q2Q%-1.64%
3.2 Future
The Earnings Per Share is expected to grow by 13.18% on average over the next years. This is quite good.
The Revenue is expected to grow by 6.35% on average over the next years.
EPS Next Y4.49%
EPS Next 2Y8.38%
EPS Next 3Y11.56%
EPS Next 5Y13.18%
Revenue Next Year-2.35%
Revenue Next 2Y0.85%
Revenue Next 3Y3.41%
Revenue Next 5Y6.35%
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is stable.
4. Valuation
4.1 Price/Earnings Ratio
The Price/Earnings ratio is 20.49, which indicates a rather expensive current valuation of CMI.
CMI's Price/Earnings ratio is a bit cheaper when compared to the industry. CMI is cheaper than 65.38% of the companies in the same industry.
CMI is valuated at similar levels of the S&P average when we compare the Price/Earnings ratio to 25.51, which is the current average of the S&P500 Index.
With a Price/Forward Earnings ratio of 18.89, CMI is valued on the expensive side.
The rest of the industry has a similar Price/Forward Earnings ratio as CMI.
CMI is valuated rather cheaply when we compare the Price/Forward Earnings ratio to 34.98, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 20.49 | ||
| Fwd PE | 18.89 |
4.2 Price Multiples
CMI's Enterprise Value to EBITDA is on the same level as the industry average.
The rest of the industry has a similar Price/Free Cash Flow ratio as CMI.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 28.66 | ||
| EV/EBITDA | 13.12 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates CMI does not grow enough to justify the current Price/Earnings ratio.
CMI has a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)4.57
PEG (5Y)2.63
EPS Next 2Y8.38%
EPS Next 3Y11.56%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 1.71%, CMI has a reasonable but not impressive dividend return.
CMI's Dividend Yield is rather good when compared to the industry average which is at 1.87. CMI pays more dividend than 80.77% of the companies in the same industry.
Compared to the average S&P500 Dividend Yield of 2.44, CMI is paying slightly less dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.71% |
5.2 History
On average, the dividend of CMI grows each year by 7.08%, which is quite nice.
CMI has paid a dividend for at least 10 years, which is 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)7.08%
Div Incr Years19
Div Non Decr Years20
5.3 Sustainability
38.53% of the earnings are spent on dividend by CMI. This is a low number and sustainable payout ratio.
The dividend of CMI is growing, but earnings are growing more, so the dividend growth is sustainable.
DP38.53%
EPS Next 2Y8.38%
EPS Next 3Y11.56%
NYSE:CMI (11/19/2025, 2:06:51 PM)
473.84
+8.92 (+1.92%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryMachinery
Earnings (Last)
Earnings (Next)
Inst Owners87.11%
Inst Owner Change1.01%
Ins Owners0.31%
Ins Owner Change-1.25%
Market Cap65.29B
Revenue(TTM)33.58B
Net Income(TTM)2.67B
Analysts72.59
Price Target443.27 (-6.45%)
Short Float %1.18%
Short Ratio1.78
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.71% |
Yearly Dividend6.94
Dividend Growth(5Y)7.08%
DP38.53%
Div Incr Years19
Div Non Decr Years20
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)19.52%
Min EPS beat(2)15.01%
Max EPS beat(2)24.03%
EPS beat(4)4
Avg EPS beat(4)17.02%
Min EPS beat(4)8.66%
Max EPS beat(4)24.03%
EPS beat(8)6
Avg EPS beat(8)10.42%
EPS beat(12)7
Avg EPS beat(12)7.35%
EPS beat(16)9
Avg EPS beat(16)3.53%
Revenue beat(2)2
Avg Revenue beat(2)2.37%
Min Revenue beat(2)1.44%
Max Revenue beat(2)3.3%
Revenue beat(4)3
Avg Revenue beat(4)1.79%
Min Revenue beat(4)-1.21%
Max Revenue beat(4)3.63%
Revenue beat(8)6
Avg Revenue beat(8)1.86%
Revenue beat(12)10
Avg Revenue beat(12)2.42%
Revenue beat(16)13
Avg Revenue beat(16)2.57%
PT rev (1m)5.36%
PT rev (3m)20.17%
EPS NQ rev (1m)2.1%
EPS NQ rev (3m)0.93%
EPS NY rev (1m)-0.58%
EPS NY rev (3m)6.25%
Revenue NQ rev (1m)0.53%
Revenue NQ rev (3m)0.62%
Revenue NY rev (1m)-0.01%
Revenue NY rev (3m)-0.3%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 20.49 | ||
| Fwd PE | 18.89 | ||
| P/S | 1.94 | ||
| P/FCF | 28.66 | ||
| P/OCF | 18.61 | ||
| P/B | 5.41 | ||
| P/tB | 8.71 | ||
| EV/EBITDA | 13.12 |
EPS(TTM)23.12
EY4.88%
EPS(NY)25.09
Fwd EY5.29%
FCF(TTM)16.53
FCFY3.49%
OCF(TTM)25.47
OCFY5.37%
SpS243.71
BVpS87.55
TBVpS54.41
PEG (NY)4.57
PEG (5Y)2.63
Graham Number213.41
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.93% | ||
| ROE | 22.12% | ||
| ROCE | 16.67% | ||
| ROIC | 10.92% | ||
| ROICexc | 12.51% | ||
| ROICexgc | 15.85% | ||
| OM | 12.01% | ||
| PM (TTM) | 7.94% | ||
| GM | 25.94% | ||
| FCFM | 6.78% |
ROA(3y)7.3%
ROA(5y)7.76%
ROE(3y)23.56%
ROE(5y)23.61%
ROIC(3y)10.13%
ROIC(5y)9.3%
ROICexc(3y)11.48%
ROICexc(5y)10.95%
ROICexgc(3y)15.52%
ROICexgc(5y)14.18%
ROCE(3y)16.61%
ROCE(5y)14.89%
ROICexgc growth 3Y9.39%
ROICexgc growth 5Y0.52%
ROICexc growth 3Y5.66%
ROICexc growth 5Y-1.01%
OM growth 3Y5.37%
OM growth 5Y0.23%
PM growth 3Y9.26%
PM growth 5Y3.83%
GM growth 3Y1.89%
GM growth 5Y-0.23%
F-Score6
Asset Turnover1
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.62 | ||
| Debt/FCF | 3.34 | ||
| Debt/EBITDA | 1.46 | ||
| Cap/Depr | 112.32% | ||
| Cap/Sales | 3.67% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 68.43% | ||
| Profit Quality | 85.38% | ||
| Current Ratio | 1.77 | ||
| Quick Ratio | 1.11 | ||
| Altman-Z | 4.36 |
F-Score6
WACC9.27%
ROIC/WACC1.18
Cap/Depr(3y)116.24%
Cap/Depr(5y)110.58%
Cap/Sales(3y)3.46%
Cap/Sales(5y)3.31%
Profit Quality(3y)143.42%
Profit Quality(5y)123.85%
High Growth Momentum
Growth
EPS 1Y (TTM)14.51%
EPS 3Y13.63%
EPS 5Y7.79%
EPS Q2Q%-4.61%
EPS Next Y4.49%
EPS Next 2Y8.38%
EPS Next 3Y11.56%
EPS Next 5Y13.18%
Revenue 1Y (TTM)-1.8%
Revenue growth 3Y12.39%
Revenue growth 5Y7.67%
Sales Q2Q%-1.64%
Revenue Next Year-2.35%
Revenue Next 2Y0.85%
Revenue Next 3Y3.41%
Revenue Next 5Y6.35%
EBIT growth 1Y17.83%
EBIT growth 3Y18.42%
EBIT growth 5Y7.91%
EBIT Next Year43.48%
EBIT Next 3Y20.19%
EBIT Next 5Y16.76%
FCF growth 1Y3.03%
FCF growth 3Y-42.53%
FCF growth 5Y-35.01%
OCF growth 1Y5.57%
OCF growth 3Y-12.97%
OCF growth 5Y-14.11%
CUMMINS INC / CMI FAQ
What is the ChartMill fundamental rating of CUMMINS INC (CMI) stock?
ChartMill assigns a fundamental rating of 5 / 10 to CMI.
Can you provide the valuation status for CUMMINS INC?
ChartMill assigns a valuation rating of 4 / 10 to CUMMINS INC (CMI). This can be considered as Fairly Valued.
How profitable is CUMMINS INC (CMI) stock?
CUMMINS INC (CMI) has a profitability rating of 7 / 10.
What is the earnings growth outlook for CUMMINS INC?
The Earnings per Share (EPS) of CUMMINS INC (CMI) is expected to grow by 4.49% in the next year.
How sustainable is the dividend of CUMMINS INC (CMI) stock?
The dividend rating of CUMMINS INC (CMI) is 7 / 10 and the dividend payout ratio is 38.53%.