Back to top

Image: Bigstock

Cummins (CMI) Ascends But Remains Behind Market: Some Facts to Note

Read MoreHide Full Article

In the latest trading session, Cummins (CMI - Free Report) closed at $292.70, marking a +0.79% move from the previous day. This change lagged the S&P 500's 1.2% gain on the day. On the other hand, the Dow registered a gain of 0.69%, and the technology-centric Nasdaq increased by 1.59%.

Shares of the engine maker witnessed a gain of 0.92% over the previous month, beating the performance of the Auto-Tires-Trucks sector with its loss of 11.58% and the S&P 500's loss of 4.16%.

Market participants will be closely following the financial results of Cummins in its upcoming release. The company plans to announce its earnings on May 2, 2024. On that day, Cummins is projected to report earnings of $5.11 per share, which would represent a year-over-year decline of 7.93%. In the meantime, our current consensus estimate forecasts the revenue to be $8.36 billion, indicating a 1.13% decline compared to the corresponding quarter of the prior year.

CMI's full-year Zacks Consensus Estimates are calling for earnings of $18.35 per share and revenue of $32.41 billion. These results would represent year-over-year changes of -6.81% and -4.87%, respectively.

Any recent changes to analyst estimates for Cummins should also be noted by investors. These latest adjustments often mirror the shifting dynamics of short-term business patterns. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Empirical research indicates that these revisions in estimates have a direct correlation with impending stock price performance. To exploit this, we've formed the Zacks Rank, a quantitative model that includes these estimate changes and presents a viable rating system.

The Zacks Rank system, stretching from #1 (Strong Buy) to #5 (Strong Sell), has a noteworthy track record of outperforming, validated by third-party audits, with stocks rated #1 producing an average annual return of +25% since the year 1988. Over the last 30 days, the Zacks Consensus EPS estimate has moved 0.09% lower. Cummins presently features a Zacks Rank of #3 (Hold).

Investors should also note Cummins's current valuation metrics, including its Forward P/E ratio of 15.83. This expresses no noticeable deviation compared to the average Forward P/E of 15.83 of its industry.

It is also worth noting that CMI currently has a PEG ratio of 1.97. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. CMI's industry had an average PEG ratio of 1.97 as of yesterday's close.

The Automotive - Internal Combustion Engines industry is part of the Auto-Tires-Trucks sector. This group has a Zacks Industry Rank of 94, putting it in the top 38% of all 250+ industries.

The Zacks Industry Rank is ordered from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Ensure to harness Zacks.com to stay updated with all these stock-shifting metrics, among others, in the next trading sessions.


See More Zacks Research for These Tickers


Normally $25 each - click below to receive one report FREE:


Cummins Inc. (CMI) - free report >>

Published in