CUMMINS INC (CMI) Fundamental Analysis & Valuation

NYSE:CMI • US2310211063

Current stock price

511.7 USD
-11.54 (-2.21%)
At close:
509.266 USD
-2.43 (-0.48%)
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.
  • In the past year CMI had a positive cash flow from operations.
  • In the past 5 years CMI has always 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.
  • With an excellent Return On Invested Capital value of 12.12%, CMI belongs to the best of the industry, outperforming 80.92% of the companies in the same industry.
  • The Average Return On Invested Capital over the past 3 years 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

  • With a decent Profit Margin value of 8.44%, CMI is doing good in the industry, outperforming 67.94% of the companies in the same industry.
  • In the last couple of years the Profit Margin of CMI has remained more or less at the same level.
  • The Operating Margin of CMI (11.45%) is comparable to the rest of the industry.
  • CMI's Operating Margin has improved in the last couple of years.
  • 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

  • CMI has a Return on Invested Capital (ROIC), which is just above the Cost of Capital (WACC), which means it is creating some value.
  • CMI has more shares outstanding than it did 1 year ago.
  • CMI has less shares outstanding than it did 5 years ago.
  • 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

  • CMI has an Altman-Z score of 4.51. This indicates that CMI is financially healthy and has little risk of bankruptcy at the moment.
  • CMI's Altman-Z score of 4.51 is fine compared to the rest of the industry. CMI outperforms 70.23% of its industry peers.
  • The Debt to FCF ratio of CMI is 3.17, which is a good value as it means it would take CMI, 3.17 years of fcf income to pay off all of its debts.
  • CMI's Debt to FCF ratio of 3.17 is fine compared to the rest of the industry. CMI outperforms 67.94% of its industry peers.
  • A Debt/Equity ratio of 0.60 indicates that CMI is somewhat dependend on debt financing.
  • CMI's Debt to Equity ratio of 0.60 is on the low side compared to the rest of the industry. CMI is outperformed by 61.07% of its industry peers.
Industry RankSector Rank
Debt/Equity 0.6
Debt/FCF 3.17
Altman-Z 4.51
ROIC/WACC1.21
WACC10.01%
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 has a worse Current ratio (1.76) than 61.83% of its industry peers.
  • A Quick Ratio of 1.16 indicates that CMI should not have too much problems paying its short term obligations.
  • With a Quick ratio value of 1.16, CMI perfoms like the industry average, outperforming 42.75% of the companies in the same 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

  • 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%.
  • Measured over the past years, CMI shows a quite strong growth in Revenue. The Revenue has been growing by 11.19% on average per year.
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.
  • 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.
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

  • A Price/Earnings ratio of 23.00 indicates a rather expensive valuation of CMI.
  • CMI's Price/Earnings is on the same level as the industry average.
  • CMI's Price/Earnings ratio indicates a similar valuation than the S&P500 average which is at 24.75.
  • With a Price/Forward Earnings ratio of 19.35, CMI is valued on the expensive side.
  • Compared to the rest of the industry, the Price/Forward Earnings ratio of CMI is on the same level as its industry peers.
  • When comparing the Price/Forward Earnings ratio of CMI to the average of the S&P500 Index (22.10), we can say CMI is valued inline with the index average.
Industry RankSector Rank
PE 23
Fwd PE 19.35
CMI Price Earnings VS Forward Price EarningsCMI Price Earnings VS Forward Price Earnings ChartPrice Earnings - Forward Price Earnings PE FPE 5 10 15 20

4.2 Price Multiples

  • CMI's Enterprise Value to EBITDA ratio is in line with the industry average.
  • The rest of the industry has a similar Price/Free Cash Flow ratio as CMI.
Industry RankSector Rank
P/FCF 29.63
EV/EBITDA 14.76
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.
  • CMI's earnings are expected to grow with 17.47% in the coming years. This may justify a more expensive valuation.
PEG (NY)1.22
PEG (5Y)1.76
EPS Next 2Y19.04%
EPS Next 3Y17.47%

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

8

5. CMI Dividend Analysis

5.1 Amount

  • CMI has a Yearly Dividend Yield of 1.51%.
  • CMI's Dividend Yield is rather good when compared to the industry average which is at 1.20. CMI pays more dividend than 81.68% of the companies in the same industry.
  • Compared to an average S&P500 Dividend Yield of 1.89, CMI has a dividend comparable with the average S&P500 company.
Industry RankSector Rank
Dividend Yield 1.51%

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 their dividend for at least 10 years, which is a reliable track record.
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.
  • The dividend of CMI is growing, but earnings are growing more, so the dividend growth is 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 (3/30/2026, 8:04:00 PM)

After market: 509.266 -2.43 (-0.48%)

511.7

-11.54 (-2.21%)

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 Cap70.70B
Revenue(TTM)33.67B
Net Income(TTM)2.84B
Analysts75.56
Price Target631.39 (23.39%)
Short Float %1.08%
Short Ratio1.5
Dividend
Industry RankSector Rank
Dividend Yield 1.51%
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)0.83%
PT rev (3m)16.64%
EPS NQ rev (1m)0.01%
EPS NQ rev (3m)2.43%
EPS NY rev (1m)-0.85%
EPS NY rev (3m)-0.02%
Revenue NQ rev (1m)0.02%
Revenue NQ rev (3m)3.34%
Revenue NY rev (1m)0.02%
Revenue NY rev (3m)1.6%
Valuation
Industry RankSector Rank
PE 23
Fwd PE 19.35
P/S 2.1
P/FCF 29.63
P/OCF 19.53
P/B 5.73
P/tB 8.88
EV/EBITDA 14.76
EPS(TTM)22.25
EY4.35%
EPS(NY)26.44
Fwd EY5.17%
FCF(TTM)17.27
FCFY3.37%
OCF(TTM)26.21
OCFY5.12%
SpS243.69
BVpS89.38
TBVpS57.6
PEG (NY)1.22
PEG (5Y)1.76
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 4.51
F-Score5
WACC10.01%
ROIC/WACC1.21
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 6 / 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 and the Price/Book (PB) ratio is 5.73.


Can you provide the dividend sustainability for CMI stock?

The dividend rating of CUMMINS INC (CMI) is 8 / 10 and the dividend payout ratio is 37.11%.