CUMMINS INC (CMI) Fundamental Analysis & Valuation

NYSE:CMI • US2310211063

Current stock price

530 USD
-23.36 (-4.22%)
At close:
530 USD
0 (0%)
After Hours:

This CMI fundamental analysis includes valuation metrics, fair value assessment, financial health analysis, profitability trends, growth metrics and dividend sustainability analysis.

7

1. CMI Profitability Analysis

1.1 Basic Checks

  • In the past year CMI was profitable.
  • CMI had a positive operating cash flow in the past year.
  • 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.
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's Return On Assets of 8.36% is fine compared to the rest of the industry. CMI outperforms 75.57% of its industry peers.
  • Looking at the Return On Equity, with a value of 23.02%, CMI belongs to the top of the industry, outperforming 89.31% of the companies in the same industry.
  • Looking at the Return On Invested Capital, with a value of 12.12%, CMI belongs to the top of the industry, outperforming 80.92% of the companies in the same industry.
  • Measured over the past 3 years, the Average Return On Invested Capital for CMI is above the industry average of 10.17%.
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 has a Profit Margin of 8.44%. This is in the better half of the industry: CMI outperforms 67.18% of its industry peers.
  • CMI's Profit Margin has been stable in the last couple of years.
  • Looking at the Operating Margin, with a value of 11.45%, CMI is in line with its industry, outperforming 58.78% of the companies in the same industry.
  • In the last couple of years the Operating Margin of CMI has grown nicely.
  • CMI has a worse Gross Margin (25.29%) than 64.89% of its industry peers.
  • CMI's Gross Margin has been stable in the last couple of years.
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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5

2. CMI Health Analysis

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.
  • The number of shares outstanding for CMI has been increased compared to 1 year ago.
  • CMI has less shares outstanding than it did 5 years ago.
  • The debt/assets ratio for CMI has been reduced compared to a year ago.
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

  • CMI has an Altman-Z score of 4.67. This indicates that CMI is financially healthy and has little risk of bankruptcy at the moment.
  • CMI has a Altman-Z score of 4.67. This is in the better half of the industry: CMI outperforms 70.99% 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.
  • CMI has a better Debt to FCF ratio (3.17) than 67.94% of its industry peers.
  • CMI has a Debt/Equity ratio of 0.60. This is a neutral value indicating CMI is somewhat dependend on debt financing.
  • With a Debt to Equity ratio value of 0.60, CMI is not doing good in the industry: 61.07% of the companies in the same industry are doing better.
Industry RankSector Rank
Debt/Equity 0.6
Debt/FCF 3.17
Altman-Z 4.67
ROIC/WACC1.22
WACC9.93%
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

  • A Current Ratio of 1.76 indicates that CMI should not have too much problems paying its short term obligations.
  • With a Current ratio value of 1.76, CMI is not doing good in the industry: 61.83% of the companies in the same industry are doing better.
  • CMI has a Quick Ratio of 1.16. 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 Quick ratio of 1.16 is in line compared to the rest of the industry. CMI outperforms 42.75% of its industry peers.
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

  • The Earnings Per Share has been growing slightly by 4.17% over the past year.
  • CMI shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 13.03% yearly.
  • CMI shows a decrease in Revenue. In the last year, the revenue decreased by -1.27%.
  • The Revenue has been growing by 11.19% on average over the past years. This is quite good.
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.
  • The Revenue is expected to grow by 8.57% on average over the next years. This is quite good.
EPS Next Y18.82%
EPS Next 2Y19.04%
EPS Next 3Y17.47%
EPS Next 5Y16.27%
Revenue Next Year7.12%
Revenue Next 2Y7.83%
Revenue Next 3Y7.77%
Revenue Next 5Y8.57%

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.
  • 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

  • CMI is valuated rather expensively with a Price/Earnings ratio of 23.82.
  • 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 (25.23), we can say CMI is valued inline with the index average.
  • A Price/Forward Earnings ratio of 20.05 indicates a rather expensive valuation of CMI.
  • CMI's Price/Forward Earnings is on the same level as the industry average.
  • When comparing the Price/Forward Earnings ratio of CMI to the average of the S&P500 Index (22.51), we can say CMI is valued inline with the index average.
Industry RankSector Rank
PE 23.82
Fwd PE 20.05
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

  • Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of CMI is on the same level as its industry peers.
  • Compared to the rest of the industry, the Price/Free Cash Flow ratio of CMI is on the same level as its industry peers.
Industry RankSector Rank
P/FCF 30.69
EV/EBITDA 15.92
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.
  • CMI has a very decent profitability rating, which 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)1.27
PEG (5Y)1.83
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 1.48%.
  • CMI's Dividend Yield is rather good when compared to the industry average which is at 1.22. CMI pays more dividend than 80.15% of the companies in the same industry.
  • CMI's Dividend Yield is slightly below the S&P500 average, which is at 1.90.
Industry RankSector Rank
Dividend Yield 1.48%

5.2 History

  • On average, the dividend of CMI grows each year by 7.87%, 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)7.87%
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

  • 37.11% of the earnings are spent on dividend by CMI. This is a low number and 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 (3/26/2026, 8:04:00 PM)

After market: 530 0 (0%)

530

-23.36 (-4.22%)

Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryMachinery
Earnings (Last)02-05
Earnings (Next)05-04
Inst Owners87.15%
Inst Owner Change2.92%
Ins Owners0.29%
Ins Owner Change3.83%
Market Cap73.23B
Revenue(TTM)33.67B
Net Income(TTM)2.84B
Analysts75.56
Price Target626.16 (18.14%)
Short Float %1.08%
Short Ratio1.5
Dividend
Industry RankSector Rank
Dividend Yield 1.48%
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)-0.28%
EPS NQ rev (3m)3.05%
EPS NY rev (1m)-0.85%
EPS NY rev (3m)0.1%
Revenue NQ rev (1m)0.02%
Revenue NQ rev (3m)3.35%
Revenue NY rev (1m)0.02%
Revenue NY rev (3m)1.61%
Valuation
Industry RankSector Rank
PE 23.82
Fwd PE 20.05
P/S 2.17
P/FCF 30.69
P/OCF 20.22
P/B 5.93
P/tB 9.2
EV/EBITDA 15.92
EPS(TTM)22.25
EY4.2%
EPS(NY)26.44
Fwd EY4.99%
FCF(TTM)17.27
FCFY3.26%
OCF(TTM)26.21
OCFY4.94%
SpS243.69
BVpS89.38
TBVpS57.6
PEG (NY)1.27
PEG (5Y)1.83
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 4.67
F-Score5
WACC9.93%
ROIC/WACC1.22
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 Year7.12%
Revenue Next 2Y7.83%
Revenue Next 3Y7.77%
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 Fundamental Analysis 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 23.82 and the Price/Book (PB) ratio is 5.93.


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%.