Cummins Inc.
$682.33
+6.0%Cummins Inc. designs, manufactures, distributes, and services diesel and natural gas engines, electric and hybrid powertrains, and related components worldwide. It operates through five segments: Engine, Distribution, Components, Power Systems, and New Power. The company offers diesel and natural gas-powered engines under the Cummins and other customer brands for the heavy and medium-duty truck, bus, recreational vehicle, light-duty automotive, construction, mining, marine, rail, oil and gas, defense, and agricultural markets; and offers new parts and services, as well as remanufactured parts and engines. It also provides power generation systems, high-horsepower engines, heavy and medium duty engines, application engineering services, custom-designed assemblies, retail and wholesale aftermarket parts, and in-shop and field-based repair services. In addition, the company offers emission solutions; turbochargers; air and fuel filters, fuel water separators, lube and hydraulic filters, coolants, fuel additives, and other filtration systems; and electronic control modules, sensors, and supporting software, as well as new, replacement, and remanufactured fuel systems. Further, it provides automated transmissions; standby and prime power generators, controls, paralleling systems, and transfer switches, as well as A/C generator/alternator products under the Stamford and AVK brands; and electrified power systems with components and subsystems, including battery, fuel cell, and hydrogen production technologies. Additionally, it offers filtration, aftertreatment, controls systems, air handling systems, automated transmissions, electric power generation systems, and batteries. The company sells its products to original equipment manufacturers, distributors, dealers, and other customers. The company was formerly known as Cummins Engine Company and changed its name to Cummins Inc. in 2001. Cummins Inc. was founded in 1919 and is headquartered in Columbus, Indiana.
At a Glance
Live SnapshotIntrinsic Alpha Methodology
Thesis Lenses
Signal
High confidenceValuation multiple is elevated (P/E 33.1).
Valuation inputs: P/E 33.1, earnings yield +3.0%, momentum +6.0%.
If multiples stay elevated while momentum fades, downside repricing risk rises.
Driver
High confidenceReturn profile is strong (ROE +23.0%, ROIC +11.8%).
Profitability stack: net margin +8.4%, ROE +23.0%, ROIC +11.8%.
Quality deterioration often appears in margins before it shows up in headline EPS.
Risk
High confidenceDownside profile looks controlled across current risk inputs.
Risk factors: liabilities/assets +60.6%, momentum +6.0%, net margin +8.4%.
Higher leverage with weak momentum and thin margins can amplify drawdown severity.
Cummins Inc. Market vs Earnings Trajectory
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Cummins Inc. Fair Value Envelope
Cummins Inc. Profit Bridge
Profitability Analysis
Gross Margin
Moderate margins typical of competitive industries. Monitor for pricing pressure or rising costs.
Operating Margin
Acceptable margins but limited operational leverage. Operating expense control is important.
Net Profit Margin
Moderate profitability with room for improvement. Monitor interest expenses and tax efficiency.
Effective Tax Rate
Higher tax burden may reflect limited tax optimization or operations in high-tax jurisdictions.
Profitability Insight
Efficient profit conversion: Minimal margin compression from gross to net indicates lean operations and favorable tax/interest environment.
Cummins Inc. Cash Conversion Engine
Cash Flow Quality Analysis
FCF Conversion Rate
Strong cash conversion. Most reported earnings translate into actual cash flow, suggesting solid fundamentals.
CapEx Intensity
Moderate capital requirements typical of many stable businesses. Healthy balance between reinvestment and cash generation.
FCF Growth Trend
Strong FCF growth demonstrates improving cash generation and business momentum. Positive signal for sustainability.
Working Capital Impact
Moderate working capital outflow. Typical for growing businesses, but ensure it's supporting revenue growth, not inefficiency.
Cash Flow Quality Insight
Solid cash generation: Positive free cash flow with reasonable earnings quality provides financial flexibility for growth investments, debt reduction, or shareholder returns.
Cummins Inc. Funding & Solvency Profile
Financial Health Analysis
Current Ratio
Strong liquidity. The company has adequate resources to meet short-term liabilities.
Debt-to-Equity Ratio
Elevated leverage. Debt exceeds equity, which amplifies both gains and risks. Monitor debt servicing ability.
Working Capital
Strong working capital position provides significant operational flexibility and financial cushion.
Asset Composition
Balanced asset mix between current and non-current assets, typical of many stable businesses.
Cummins Inc. Street Expectations Map
Wall Street analysts project that CMI stock may experience modest gains over the coming 12 months. The consensus 1-year price target stands at 702.00, with estimates ranging from a low of 540.00 to a high of 845.00.
The consensus 1-year price target stands at 702.00, with estimates ranging from a low of 540.00 to a high of 845.00.
Analyst Consensus Analysis
Upside Potential
Fair value territory. Stock trading near consensus target suggests limited near-term catalysts. Focus on fundamental developments.
Analyst Agreement
Mixed analyst views. Wide target range suggests differing opinions on key value drivers, growth prospects, or risk factors.
Risk-Reward Profile
Balanced risk-reward. Upside and downside potential relatively symmetric. Suitable for moderate risk tolerance with conviction in thesis.
Analyst Conviction
Neutral sentiment. Fair value pricing with moderate agreement suggests wait-and-see approach or catalyst-driven opportunity.
Market Sentiment Insight
Monitor and evaluate: Current analyst consensus suggests limited conviction or near-term catalysts. Stay informed on company developments and reassess positioning as new information emerges.
Cummins Inc. Insider Positioning
During the last 12 months, insiders have sold $25.00M worth of CMI shares, with no buying activity reported.
3 Months
0
0.00
2.6K
1.78M
-1.8M
-$1.78M
3-6 Months
0
0.00
2.6K
1.55M
-1.5M
-$1.55M
6-9 Months
0
0.00
26.9K
11.93M
-11.9M
-$11.93M
9-12 Months
0
0.00
24.4K
9.74M
-9.7M
-$9.74M
Top Buyers
No buying activity
Top Sellers
Smith Mark Andrew
Officer: Vp - Chief Financial Officer
$14.86M
Jackson Donald G
Officer: Vp - Treasury & Tax
$2.39M
Rumsey Jennifer
Director, Officer: Chair And Ceo
$1.36M
Peters Luther E
Officer: Vp - Corporate Controller
$1.25M
Fetch Bonnie J
Officer: Evp & President - Operations
$908K
Insider Activity Analysis
Net Insider Sentiment
Strong bearish signal with $25.00M net selling. Heavy insider selling may indicate concerns about valuation or near-term prospects.
Buy/Sell Ratio
Very poor ratio. Heavy selling with minimal buying suggests insiders may be concerned about valuation or outlook.
Recent Trend (3 Months)
Heavy recent selling activity. Recent insider sales notably exceed purchases—may warrant investigation into company developments.
Insider Participation
5 insider sellers vs. 0 buyers. Widespread selling across multiple insiders may signal concerns.
Insider Activity Insight
Multiple red flags: Heavy selling, numerous sellers, and continued recent selling create a concerning pattern. Investigate fundamental drivers and consider whether company guidance or industry conditions have deteriorated.
cmi Dividend History
Learning Layer
Related Guides
Build conviction on CMI by pairing this stock hub with focused valuation guides.
Research Paths
Snapshot
Start with context, operating signals, and key market metrics.
Value Model
Stress test fair value across bear, base, and bull assumptions.
Statements
Validate revenue quality, margins, and balance sheet durability.
Earnings Call
Read management commentary and compare it with reported outcomes.
Dividends
Check payout sustainability and long-term distribution behavior.
Analyst Expectations
Review consensus spread and where estimate risk is concentrated.