Cummins Inc
CMI
Engines & Turbines
Mkt Cap
$39.33BPE
20.29Debt
$6.948BCash
$2.541BEV
$43.74BFCF
$2.558BP/E Ratio
20.29Debt
$6.948BCash
$2.541BEV
$43.74BFCF
$2.558BCharts data: {"Earnings":[{"time":"2014-12-30","value":1651000000},{"time":"2015-12-30","value":1399000000},{"time":"2016-12-30","value":1394000000},{"time":"2017-12-30","value":994000000},{"time":"2018-12-30","value":2141000000},{"time":"2019-12-30","value":2260000000},{"time":"2020-12-30","value":1789000000},{"time":"2021-12-30","value":2131000000},{"time":"2022-12-30","value":2151000000},{"time":"2023-12-30","value":735000000}],"Sales":[{"time":"2014-12-30","value":19221000000},{"time":"2015-12-30","value":19110000000},{"time":"2016-12-30","value":17509000000},{"time":"2017-12-30","value":20428000000},{"time":"2018-12-30","value":23771000000},{"time":"2019-12-30","value":23571000000},{"time":"2020-12-30","value":19811000000},{"time":"2021-12-30","value":24021000000},{"time":"2022-12-30","value":28074000000},{"time":"2023-12-30","value":34065000000}],"Net Margins":[{"time":"2014-12-30","value":0.08589563498257115},{"time":"2015-12-30","value":0.07320774463631606},{"time":"2016-12-30","value":0.0796161973842024},{"time":"2017-12-30","value":0.048658703739964754},{"time":"2018-12-30","value":0.09006772958647091},{"time":"2019-12-30","value":0.09588053116117262},{"time":"2020-12-30","value":0.09030336681641513},{"time":"2021-12-30","value":0.08871404188002165},{"time":"2022-12-30","value":0.07661893567001496},{"time":"2023-12-30","value":0.02157639806252752}],"Assets":[{"time":"2014-12-30","value":15776000000},{"time":"2015-12-30","value":15134000000},{"time":"2016-12-30","value":15011000000},{"time":"2017-12-30","value":18075000000},{"time":"2018-12-30","value":19062000000},{"time":"2019-12-30","value":19737000000},{"time":"2020-12-30","value":22624000000},{"time":"2021-12-30","value":23710000000},{"time":"2022-12-30","value":30299000000},{"time":"2023-12-30","value":32005000000}],"Stockholders Equity":[{"time":"2014-12-30","value":8093000000},{"time":"2015-12-30","value":7750000000},{"time":"2016-12-30","value":7174000000},{"time":"2017-12-30","value":8164000000},{"time":"2018-12-30","value":8259000000},{"time":"2019-12-30","value":8465000000},{"time":"2020-12-30","value":8989000000},{"time":"2021-12-30","value":9401000000},{"time":"2022-12-30","value":9967000000},{"time":"2023-12-30","value":9904000000}],"ROE":[{"time":"2014-12-30","value":0.20400345978005685},{"time":"2015-12-30","value":0.18051612903225805},{"time":"2016-12-30","value":0.1943127962085308},{"time":"2017-12-30","value":0.12175404213620775},{"time":"2018-12-30","value":0.2592323525850587},{"time":"2019-12-30","value":0.2669816893089191},{"time":"2020-12-30","value":0.19902102569807542},{"time":"2021-12-30","value":0.22667801297734283},{"time":"2022-12-30","value":0.21581218019464232},{"time":"2023-12-30","value":0.0742124394184168}],"ROA":[{"time":"2014-12-30","value":0.15428498985801217},{"time":"2015-12-30","value":0.1359191225056165},{"time":"2016-12-30","value":0.12857238025448003},{"time":"2017-12-30","value":0.13084370677731674},{"time":"2018-12-30","value":0.1461546532368062},{"time":"2019-12-30","value":0.1435881846278563},{"time":"2020-12-30","value":0.10334158415841584},{"time":"2021-12-30","value":0.11602699283002953},{"time":"2022-12-30","value":0.0966698570909931},{"time":"2023-12-30","value":0.05502265271051398}]}
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.
DCF
Discounted Cash Flow Valuation of Cummins Inc
Value
Growth
%
%
Discount
%
%
Multiple
| g\r | +10% | +11% | +12% | +13% | +14% |
|---|---|---|---|---|---|
| 0% | 10 | 9 | 8 | 8 | 7 |
| +1% | 11 | 10 | 9 | 8 | 8 |
| +2% | 13 | 11 | 10 | 9 | 8 |
| +3% | 14 | 13 | 11 | 10 | 9 |
| +4% | 17 | 14 | 12 | 11 | 10 |
| Years | 0 | 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 | 9 | 10 | TV |
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| FCF | $2.558B | $2.618B | $2.68B | $2.743B | $2.808B | $2.874B | $2.941B | $3.011B | $3.082B | $3.154B | $3.229B | $32.29B |
| DCF | $2.277B | $2.026B | $1.804B | $1.605B | $1.429B | $1.272B | $1.132B | $1.007B | $896.6M | $798.1M | $7.981B | |
| Value | $22.23B | |||||||||||
In the chart Earnings are multiplied by this value.
Earnings Growth 5.4%
Earnings Stability 19%
Competitiveness and MOAT
High margins render the company resilient under dire circumstances, hence able to drive competitors out or acquire them. ROE and ROA measure the average flow generated by each invested dollar. Their marginal value is a forecast of future growth, and it is considered by Buffett and Munger the most important single indicator.
| Years | 12-2015 | 12-2016 | 12-2017 | 12-2018 | 12-2019 | 12-2020 | 12-2021 | 12-2022 | 12-2023 | TTM |
|---|---|---|---|---|---|---|---|---|---|---|
| Net Margin | 7.3% | 8% | 4.9% | 9% | 9.6% | 9% | 8.9% | 7.7% | 2.2% | 5.7% |
| ROA | 14% | 13% | 13% | 15% | 14% | 10% | 12% | 9.7% | 5.5% | 9.3% |
| ROE | 18% | 19% | 12% | 26% | 27% | 20% | 23% | 22% | 7.4% | 19% |
What is the average Net Margin?
The average Net Margin over the past 5 years is +7.72%.
What is the trend of Net Margin?
The trend of Net Margin over the past 5 years is -1.15%.
What is the average Return on Assets (ROA)?
The average ROA over the past 5 years is +11.01%.
What is the trend of Return on Assets (ROA)?
The trend of ROA over the past 5 years is -1.67%.
What is the average Return on Equity (ROE)?
The average ROE over the past 5 years is +20.7%.
What is the trend of Return on Equity (ROE)?
The trend of ROE over the past 5 years is -3%.
Safety & Stabiliy
Being debt the number one cause of investment losses and company death, the ratio Debt/FCF is of utmost importance to guarantee safety. On the other hand the Graham’s stability measures the drawdown of earnings, hence indicating the reliability of the flow generated by the company.
| Years | 12-2015 | 12-2016 | 12-2017 | 12-2018 | 12-2019 | 12-2020 | 12-2021 | 12-2022 | 12-2023 | TTM |
|---|---|---|---|---|---|---|---|---|---|---|
| Debt FCF | 1.28 | 1.35 | 1.17 | 1.51 | 0.97 | 1.93 | 2.77 | 8.06 | 2.48 | 2.72 |
| Debt Equity | 0.22 | 0.26 | 0.25 | 0.31 | 0.28 | 0.47 | 0.45 | 0.85 | 0.69 | 0.69 |
| MIN | ||||||||||
| Graham Stability | - | - | 67% | 100% | 100% | 99% | 100% | 100% | 36% | 36% |
What is the Debt/FCF?
The Debt/FCF trailing twelve month is 2.72.
What is the trend of Debt/FCF?
The trend of Debt/FCF over the past 5 years is 0.77.
What is the Graham’s Stability?
Graham’s Stability measure stands at 0.36.
Growth
Growth can be dangerous when forecasting, simply projecting the current growth is in general wrong. A company passes through multiple phases, from being young and unprofitable, to the first periods of profitability and high growth, until it arrives at a period of regime with limited growth. Identifying in which phase the company is in may help forecasting.
| Years | 12-2016 | 12-2018 | 12-2020 | 12-2022 | Trend |
|---|---|---|---|---|---|
| Revenue | 10% | 7.5% | 20% | 21% | 2.3% |
| Net Income | -8.7% | -19% | -26% | -66% | -4% |
| Stockholders Equity | 4.7% | 3.7% | 3.3% | -0.63% | 0.69% |
| FCF | 10% | 11% | 7.9% | 160% | 7.9% |
What is the 5 year Revenue CAGR?
The Revenue CAGR over the past 5 years is +7.46%.
What is the trend of Revenue growth?
The trend of Revenue growth rate over the past 5 years is +2.34%.
What is the 5 year Earnings CAGR?
The Earnings CAGR over the past 5 years is -19.25%.
What is the trend of Earnings growth?
The trend of Earnings growth rate over the past 5 years is -3.98%.
What is the 5 year Equity CAGR?
The Equity CAGR over the past 5 years is +3.7%.
What is the trend of Equity growth?
The trend of Equity growth rate over the past 5 years is +0.69%.
What is the 5 year FCF CAGR?
The FCF CAGR over the past 5 years is +10.53%.
What is the trend of FCF growth?
The trend of FCF growth rate over the past 5 years is +7.9%.