Cummins Inc (CMI)
NYSE:CMI
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Cummins
(NYSE:CMI)
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Rating:76Outperform
Price Target:
$802.00
â–²(27.87% Upside)
Action:Reiterated
Date:05/15/26
CMI scores well on strong technical momentum and solid, improving fundamentals, supported by an upbeat earnings call with raised 2026 guidance and standout Power Systems performance. The main constraints are a relatively expensive valuation (P/E 28.44 with a low ~1.10% yield) and some cyclicality/volatility risks in leverage and cash conversion, alongside Engine margin pressure and continued Accelera losses.
Positive Factors
Power Systems margins & growth
Power Systems is a structurally higher‑margin, growing business driven by data center and backup power demand. Record Q1 profitability and upgraded revenue/margin guidance indicate durable earnings contribution, improving portfolio mix and helping insulate overall margins from cyclical engine weakness.
Negative Factors
Engine segment margin pressure
Engines remain a core but cyclical business tied to North American on‑highway volumes. Sharp Q1 margin compression from weaker volumes, higher compensation and R&D for upcoming launches highlights sensitivity of corporate profitability to OEM cycles and transition costs, a multi‑quarter risk.
Read all positive and negative factors
Positive Factors
Negative Factors
Power Systems margins & growth
Power Systems is a structurally higher‑margin, growing business driven by data center and backup power demand. Record Q1 profitability and upgraded revenue/margin guidance indicate durable earnings contribution, improving portfolio mix and helping insulate overall margins from cyclical engine weakness.
Read all positive factors
Cummins Key Performance Indicators (KPIs)
Any
Revenue by Geography
Breaks down revenue across regions (North America, EMEA, Asia-Pacific, Latin America) to show where Cummins earns sales and which markets drive growth. Reveals dependence on heavy-truck and industrial demand in certain areas, exposure to currency and economic swings, and where aftermarket or growth opportunities (like Asia or emerging markets) may offset weakness elsewhere.
Breaks down revenue across regions (North America, EMEA, Asia-Pacific, Latin America) to show where Cummins earns sales and which markets drive growth. Reveals dependence on heavy-truck and industrial demand in certain areas, exposure to currency and economic swings, and where aftermarket or growth opportunities (like Asia or emerging markets) may offset weakness elsewhere.
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The Fly
The FlyCummins (CMI) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$88.25B
Dividend Yield1.48%
Average Volume (3M)905.07K
Price to Earnings (P/E)28.4
Beta (1Y)1.13
Revenue Growth0.06%
EPS Growth-4.25%
CountryUS
Employees69,600
SectorIndustrials
Sector Strength72
IndustryIndustrial - Machinery
Share Statistics
EPS (TTM)19.36
Shares Outstanding137,989,060
10 Day Avg. Volume977,724
30 Day Avg. Volume905,070
Financial Highlights & Ratios
PEG Ratio-0.89
Price to Book (P/B)5.70
Price to Sales (P/S)2.09
P/FCF Ratio29.50
Enterprise Value/Market Cap1.06
Enterprise Value/Revenue2.77
Enterprise Value/Gross Profit10.91
Enterprise Value/Ebitda19.52
Forecast
1Y Price Target
$748.82Price Target Upside19.39% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering11
EPS Forecast (FY)29.01
Revenue Forecast (FY)$37.03B
Cummins Business Overview & Revenue Model
Company Description
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, an...
How the Company Makes Money
Cummins primarily makes money by selling powertrain and power generation products and by providing parts and service over the life of that equipment. Key revenue streams include: (1) Engine and powertrain-related product sales: Cummins sells diese...
Cummins Earnings Call Summary
Earnings Call Date:May 05, 2026
(Q1-2026)
| % Change Since: |
Next Earnings Date:Aug 04, 2026
Earnings Call Sentiment Positive
The call was overall positive: management reported modest organic revenue growth in Q1, strong international and data-center driven demand (notably in China), record Power Systems profitability, improved full-year revenue and EBITDA margin guidance, improved cash flow and active capital returns. These positives are tempered by continued weakness in North America on-highway truck volumes, significant margin pressure in the Engine segment this quarter, ongoing Accelera losses (including a one-time $199M charge), higher compensation-driven expenses, and regulatory/tariff uncertainties that could affect near-term transitions. On balance, the positive operational momentum, guidance upgrades and cash generation improvements outweigh the near-term headwinds.Positive Updates
Revenue Growth and Raised Full-Year Guidance
Q1 sales of $8.4 billion, up 3% year-over-year. Company raised 2026 full-year revenue guidance to +8% to +11% (from prior +3% to +8%).
Negative Updates
Engine Segment Margin Compression in Q1
Engine segment Q1 revenues $2.7 billion, down 4% y/y; Engine EBITDA fell to 10.4% from 16.5% a year ago — a significant margin decline tied to weaker North America on-highway volumes, higher compensation and R&D ahead of 2027 launches.
Read all updates
Q1-2026 Updates
Positive
Negative
Revenue Growth and Raised Full-Year Guidance
Q1 sales of $8.4 billion, up 3% year-over-year. Company raised 2026 full-year revenue guidance to +8% to +11% (from prior +3% to +8%).
Read all positive updates
Company Guidance
Cummins raised its 2026 outlook, now expecting total company revenues up 8%–11% with EBITDA margins of 17.75%–18.5% (Q1 was $8.4B sales, EBITDA $1.3B or 15.4% including a $199M charge; ex‑charge $1.5B or 17.7%). Regional and market guidance includes North America heavy‑duty truck builds of 230k–250k units (up from 220k–240k) and medium‑duty 125k–135k (up from 110k–120k); pickup engine shipments of 125k–140k; China revenues (incl. JVs) +10% (vs prior down 1%) with heavy/medium trucks down 10%–flat and power generation sales much stronger; India revenues (incl. JVs) +2% (vs prior -5%), industry truck demand -5%–+5%; global construction flat–+10%; power generation revenues +15%–25% (up from +10%–20%); mining engines flat–+10%; Aftermarket +2%–8%. Segment guides were raised: Engine revenues +7%–12% with EBITDA margin 12.5%–13.5%; Components revenues +5%–10% with 13.5%–14.5% margin; Distribution revenues +9%–14% with 13.7%–14.7% margin; Power Systems revenues +14%–19% with ~25%–26% EBITDA (Q1 Power Systems was $2B, 29.5% EBITDA). Accelera revenues are expected $300M–$350M with net EBITDA losses (ex‑fuel cell sale) improving to -$270M to -$300M. Company expects a ~23% effective tax rate in 2026 (ex discretes), total investment $1.35B–$1.45B, and reiterated capital returns (Q1 returned $519M to shareholders, $243M buybacks, $276M dividends) with operating cash flow of $309M in the quarter.Cummins Financial Statement Overview
Summary
Income Statement
78
Positive
Balance Sheet
72
Positive
Cash Flow
70
Positive
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 33.89B | 33.67B | 34.10B | 34.06B | 28.07B | 24.02B |
| Gross Profit | 8.60B | 8.52B | 8.44B | 8.25B | 6.72B | 5.70B |
| EBITDA | 4.81B | 5.40B | 6.34B | 3.02B | 3.80B | 3.52B |
| Net Income | 2.67B | 2.84B | 3.95B | 735.00M | 2.15B | 2.13B |
Balance Sheet | ||||||
| Total Assets | 34.45B | 33.99B | 31.54B | 32.01B | 30.30B | 23.71B |
| Cash, Cash Equivalents and Short-Term Investments | 3.18B | 3.61B | 2.26B | 2.74B | 2.57B | 3.19B |
| Total Debt | 8.24B | 8.11B | 7.60B | 7.21B | 8.36B | 4.61B |
| Total Liabilities | 21.07B | 20.58B | 20.23B | 22.10B | 20.07B | 14.31B |
| Stockholders Equity | 12.35B | 12.35B | 10.27B | 8.85B | 8.97B | 8.47B |
Cash Flow | ||||||
| Free Cash Flow | 2.67B | 2.39B | 279.00M | 2.75B | 1.05B | 1.47B |
| Operating Cash Flow | 3.93B | 3.62B | 1.49B | 3.97B | 1.96B | 2.26B |
| Investing Cash Flow | -1.60B | -1.84B | -1.78B | -1.64B | -4.17B | -873.00M |
| Financing Cash Flow | -1.27B | -662.00M | -173.00M | -2.18B | 1.67B | -2.23B |
Cummins Technical Analysis
Positive
627.18
Price Trends
614.76
Positive
591.27
Positive
514.88
Positive
Market Momentum
10.32
Positive
45.51
Neutral
16.16
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CMI, the sentiment is Positive. The current price of 627.18 is below the 20-day moving average (MA) of 672.77, above the 50-day MA of 614.76, and above the 200-day MA of 514.88, indicating a neutral trend. The MACD of 10.32 indicates Positive momentum. The RSI at 45.51 is Neutral, neither overbought nor oversold. The STOCH value of 16.16 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for CMI.
Cummins Risk Analysis
Cummins disclosed 32 risk factors in its most recent earnings report. Cummins reported the most risks in the "Legal & Regulatory" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Cummins Peers Comparison
UnderperformOutperform
Sector (63)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
83 Outperform | $102.65B | 39.83 | 33.12% | 0.21% | 14.24% | 40.49% | |
78 Outperform | $15.45B | 29.34 | 12.61% | 1.56% | 7.54% | 7.09% | |
77 Outperform | $109.31B | 31.24 | 24.69% | 0.79% | 6.03% | 4.26% | |
76 Outperform | $88.25B | 28.44 | 22.02% | 1.48% | 0.06% | -4.25% | |
73 Outperform | $151.96B | 40.08 | 20.81% | 1.29% | 12.68% | 3.12% | |
67 Neutral | $27.75B | 40.88 | 5.80% | 0.10% | 6.86% | -26.67% | |
63 Neutral | $10.79B | 15.43 | 7.44% | 2.01% | 2.89% | -14.66% |
* Industrials Sector Average
CMI
Cummins
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99.16%
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Cummins Corporate Events
Executive/Board ChangesShareholder Meetings
Cummins Shareholders Back Board, Pay and Incentive Plan
Positive
May 14, 2026
At its May 12, 2026 annual meeting, Cummins Inc. shareholders elected eleven directors to one-year terms expiring at the 2027 meeting and provided strong support for the company’s executive pay program, with a substantial majority backing th...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.