CUMMINS INC (CMI) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:CMI - US2310211063 - Common Stock
578.94 USD
+4.1 (+0.71%)
580 USD
+1.06 (+0.18%)
Overall CMI gets a fundamental rating of 5 out of 10. We evaluated CMI against 132 industry peers in the Machinery industry. While CMI belongs to the best of the industry regarding profitability, there are some minor concerns on its financial health. CMI is valied quite expensively at the moment, while it does show a decent growth rate. Finally CMI also has an excellent dividend rating. These ratings would make CMI suitable for dividend investing!
1. Profitability
1.1 Basic Checks
- CMI had positive earnings in the past year.
- In the past year CMI had a positive cash flow from operations.
- Each year in the past 5 years CMI has been profitable.
- CMI had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
- With a decent Return On Assets value of 7.93%, CMI is doing good in the industry, outperforming 74.24% 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 90.15% of the companies in the same industry.
- The Return On Invested Capital of CMI (10.92%) is better than 75.76% 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 last Return On Invested Capital (10.92%) for CMI is above the 3 year average (10.13%), which is a sign of increasing profitability.
| 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
- CMI has a better Profit Margin (7.94%) than 65.91% of its industry peers.
- CMI's Profit Margin has improved in the last couple of years.
- CMI's Operating Margin of 12.01% is fine compared to the rest of the industry. CMI outperforms 61.36% of its industry peers.
- CMI's Operating Margin has been stable in the last couple of years.
- With a Gross Margin value of 25.94%, CMI is not doing good in the industry: 62.12% of the companies in the same industry are doing better.
- In the last couple of years the Gross Margin of CMI has remained more or less at the same level.
| 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
- The Return on Invested Capital (ROIC) is just above the Cost of Capital (WACC), so CMI is still creating some value.
- CMI has less shares outstanding than it did 1 year ago.
- The number of shares outstanding for CMI has been reduced compared to 5 years ago.
- CMI has a worse debt/assets ratio than last year.
2.2 Solvency
- An Altman-Z score of 4.79 indicates that CMI is not in any danger for bankruptcy at the moment.
- With a decent Altman-Z score value of 4.79, CMI is doing good in the industry, outperforming 71.21% 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.
- Looking at the Debt to FCF ratio, with a value of 3.34, CMI is in the better half of the industry, outperforming 65.91% of the companies in the same industry.
- A Debt/Equity ratio of 0.62 indicates that CMI is somewhat dependend on debt financing.
- The Debt to Equity ratio of CMI (0.62) is comparable to the rest of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.62 | ||
| Debt/FCF | 3.34 | ||
| Altman-Z | 4.79 |
ROIC/WACC1.18
WACC9.25%
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.
- CMI has a worse Current ratio (1.77) than 61.36% of its industry peers.
- A Quick Ratio of 1.11 indicates that CMI should not have too much problems paying its short term obligations.
- The Quick ratio of CMI (1.11) is comparable to the rest of the 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.
- CMI shows a small growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 7.79% yearly.
- Looking at the last year, CMI shows a decrease in Revenue. The Revenue has decreased by -1.80% in the last year.
- CMI shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 7.67% yearly.
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 15.75% on average over the next years. This is quite good.
- Based on estimates for the next years, CMI will show a small growth in Revenue. The Revenue will grow by 5.43% on average per year.
EPS Next Y9.11%
EPS Next 2Y11.26%
EPS Next 3Y13.49%
EPS Next 5Y15.75%
Revenue Next Year-1.22%
Revenue Next 2Y2.05%
Revenue Next 3Y4.21%
Revenue Next 5Y5.43%
3.3 Evolution
- The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
- When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
4. Valuation
4.1 Price/Earnings Ratio
- CMI is valuated quite expensively with a Price/Earnings ratio of 25.04.
- CMI's Price/Earnings ratio is in line with the industry average.
- The average S&P500 Price/Earnings ratio is at 27.54. CMI is around the same levels.
- CMI is valuated rather expensively with a Price/Forward Earnings ratio of 21.89.
- CMI's Price/Forward Earnings ratio is in line with the industry average.
- CMI is valuated at similar levels of the S&P average when we compare the Price/Forward Earnings ratio to 24.31, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 25.04 | ||
| Fwd PE | 21.89 |
4.2 Price Multiples
- The rest of the industry has a similar Enterprise Value to EBITDA ratio as CMI.
- The rest of the industry has a similar Price/Free Cash Flow ratio as CMI.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 35.08 | ||
| EV/EBITDA | 16.1 |
4.3 Compensation for Growth
- The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
- CMI has a very decent profitability rating, which may justify a higher PE ratio.
- CMI's earnings are expected to grow with 13.49% in the coming years. This may justify a more expensive valuation.
PEG (NY)2.75
PEG (5Y)3.21
EPS Next 2Y11.26%
EPS Next 3Y13.49%
5. Dividend
5.1 Amount
- CMI has a Yearly Dividend Yield of 1.47%. Purely for dividend investing, there may be better candidates out there.
- Compared to an average industry Dividend Yield of 0.80, CMI pays a better dividend. On top of this CMI pays more dividend than 80.30% of the companies listed in the same industry.
- CMI's Dividend Yield is slightly below the S&P500 average, which is at 1.92.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.47% |
5.2 History
- On average, the dividend of CMI grows each year by 7.08%, which is quite nice.
- 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)7.08%
Div Incr Years19
Div Non Decr Years20
5.3 Sustainability
- CMI pays out 38.53% of its income as dividend. This is a sustainable payout ratio.
- The dividend of CMI is growing, but earnings are growing more, so the dividend growth is sustainable.
DP38.53%
EPS Next 2Y11.26%
EPS Next 3Y13.49%
578.94
+4.1 (+0.71%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryMachinery
Earnings (Last)11-06 2025-11-06/bmo
Earnings (Next)02-02 2026-02-02/amc
Inst Owners87.23%
Inst Owner Change0.37%
Ins Owners0.3%
Ins Owner Change-0.92%
Market Cap79.92B
Revenue(TTM)33.58B
Net Income(TTM)2.67B
Analysts76.3
Price Target541.33 (-6.5%)
Short Float %1.13%
Short Ratio1.64
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.47% |
Yearly Dividend6.94
Dividend Growth(5Y)7.08%
DP38.53%
Div Incr Years19
Div Non Decr Years20
Ex-DateN/A
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)2.8%
PT rev (3m)28.68%
EPS NQ rev (1m)0.71%
EPS NQ rev (3m)6.9%
EPS NY rev (1m)0.03%
EPS NY rev (3m)3.82%
Revenue NQ rev (1m)0.05%
Revenue NQ rev (3m)0.17%
Revenue NY rev (1m)0.01%
Revenue NY rev (3m)1.15%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 25.04 | ||
| Fwd PE | 21.89 | ||
| P/S | 2.38 | ||
| P/FCF | 35.08 | ||
| P/OCF | 22.77 | ||
| P/B | 6.62 | ||
| P/tB | 10.66 | ||
| EV/EBITDA | 16.1 |
EPS(TTM)23.12
EY3.99%
EPS(NY)26.44
Fwd EY4.57%
FCF(TTM)16.5
FCFY2.85%
OCF(TTM)25.42
OCFY4.39%
SpS243.27
BVpS87.39
TBVpS54.31
PEG (NY)2.75
PEG (5Y)3.21
Graham Number213.22
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 | 4.79 |
F-Score6
WACC9.25%
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 Y9.11%
EPS Next 2Y11.26%
EPS Next 3Y13.49%
EPS Next 5Y15.75%
Revenue 1Y (TTM)-1.8%
Revenue growth 3Y12.39%
Revenue growth 5Y7.67%
Sales Q2Q%-1.64%
Revenue Next Year-1.22%
Revenue Next 2Y2.05%
Revenue Next 3Y4.21%
Revenue Next 5Y5.43%
EBIT growth 1Y17.83%
EBIT growth 3Y18.42%
EBIT growth 5Y7.91%
EBIT Next Year45.97%
EBIT Next 3Y21.43%
EBIT Next 5Y19.2%
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.
What is the valuation status of CUMMINS INC (CMI) stock?
ChartMill assigns a valuation rating of 3 / 10 to CUMMINS INC (CMI). This can be considered as Overvalued.
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 25.04 and the Price/Book (PB) ratio is 6.62.
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 38.53%.