Cummins Inc. (CMI - Free Report) reported first-quarter 2022 earnings of $4.04 per share, flat year over year. The figure topped the Zacks Consensus Estimate of $3.55. Higher-than-expected EBITDA in the Engine segment resulted in the outperformance. Cummins’ revenues totaled $6,385 million, up from $6,092 million recorded in the year-ago quarter. The top line beat Zacks Consensus Estimate of $6,026 million.
Key Takeaways
In the reported quarter, sales in the Engine segment were up 12% year over year to $2,753 million. The segment’s EBITDA rose to $392 million (accounting for 14.2% of sales) from $354 million (14.4% of sales). The metric also crossed the Zacks Consensus Estimate of $328 million. On-highway and Off-highway revenues climbed 14% and 5%, respectively, from the prior-year quarter. Sales increased 15% in North America and 4% in international markets.
Sales in the Distribution segment totaled $2,117 million, up 15% year over year. Revenues from North America jumped 17%, while international sales soared 13%. The segment’s EBITDA came in at $110 million (5.2% of sales), sharply down from the previous year’s $160 million (8.7% of sales). The metric also missed the consensus mark of $163 million. This was on account of the suspension of activities in Russia.
Sales in the Components segment were down 8% from the prior-year quarter to $1,988 million. Sales in North America were up 8%, while the same in international markets decreased 21% amid weak demand from China and India. The segment’s EBITDA was $320 million (16.1% of sales) compared with the year-ago figure of $421 million (19.6% of sales). The metric also missed the Zacks Consensus Estimate of $342 million.
Sales in the Power Systems segment rose 14% from the year-ago quarter to $1,160 million. The segment’s EBITDA decreased to $90 million (7.8% of sales) from $126 million (12.3% of sales) and lagged the consensus mark of $117 million. Power generation revenues increased 9% year over year, while industrial revenues soared 21%, owing to stronger demand in mining and oil and gas markets.
Sales in the New Power segment came in at $31 million, down 11% from the year-ago level. The segment incurred a pretax loss of $67 million. The loss was wider than the consensus mark of $65 million.
Financials
Cummins’ cash and cash equivalents were $2,276 million as of Mar 31, 2022, down from $2,592 million on Dec 31, 2021. Long-term debt totaled $3,502 million, down from $3,579 million on Dec 31, 2021.
Cummins raised its 2022 guidance for revenues. It expects revenues to grow 8% year over year compared with the previous estimate of 6%. EBITDA forecast remains unchanged at 15.5% of sales.
Zacks Rank & Key Picks
CMI currently carries a Zacks Rank #3 (Hold).
Better-ranked players in the auto space include BRP Group, Inc. (DOOO - Free Report) , sporting a Zacks Rank #1 (Strong Buy) and Dorman Products (DORM - Free Report) and Tesla Inc. (TSLA - Free Report) , each carrying a Zacks Rank #2 (Buy), currently. You can see the complete list of today’s Zacks #1 Rank stocks here.
BRP Group has an expected earnings growth rate of 9.1% for fiscal 2023. The Zacks Consensus Estimate for current-year earnings has been revised around 7.9% upward in the past 60 days.
BRP Group’s earnings beat the Zacks Consensus Estimate in all of the trailing four quarters. DOOO pulled off a trailing four-quarter earnings surprise of 68%, on average. The stock has declined 11% over the past year.
Dorman Products has an expected earnings growth rate of 18.8% for the current year. The Zacks Consensus Estimate for current-year earnings has been marginally revised 0.7% upwards in the past 60 days.
Dorman Products’ earnings beat the Zacks Consensus Estimate in three of the trailing four quarters and missed in one. DORM pulled off a trailing four-quarter earnings surprise of 3.1%, on average. The stock has lost 2.1% over the past year.
Tesla has an expected earnings growth rate of 66.1% for the current year. The Zacks Consensus Estimate for current-year earnings has been revised around 18.7% upward in the past 60 days.
Tesla’s earnings beat the Zacks Consensus Estimate in all of the trailing four quarters. TSLA pulled off a trailing four-quarter earnings surprise of 41.27%, on average. The stock has gained 31.8% over the past year.
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Cummins Inc. (CMI - Free Report) reported first-quarter 2022 earnings of $4.04 per share, flat year over year. The figure topped the Zacks Consensus Estimate of $3.55. Higher-than-expected EBITDA in the Engine segment resulted in the outperformance. Cummins’ revenues totaled $6,385 million, up from $6,092 million recorded in the year-ago quarter. The top line beat Zacks Consensus Estimate of $6,026 million.
Key Takeaways
In the reported quarter, sales in the Engine segment were up 12% year over year to $2,753 million. The segment’s EBITDA rose to $392 million (accounting for 14.2% of sales) from $354 million (14.4% of sales). The metric also crossed the Zacks Consensus Estimate of $328 million. On-highway and Off-highway revenues climbed 14% and 5%, respectively, from the prior-year quarter. Sales increased 15% in North America and 4% in international markets.
Sales in the Distribution segment totaled $2,117 million, up 15% year over year. Revenues from North America jumped 17%, while international sales soared 13%. The segment’s EBITDA came in at $110 million (5.2% of sales), sharply down from the previous year’s $160 million (8.7% of sales). The metric also missed the consensus mark of $163 million. This was on account of the suspension of activities in Russia.
Sales in the Components segment were down 8% from the prior-year quarter to $1,988 million. Sales in North America were up 8%, while the same in international markets decreased 21% amid weak demand from China and India. The segment’s EBITDA was $320 million (16.1% of sales) compared with the year-ago figure of $421 million (19.6% of sales). The metric also missed the Zacks Consensus Estimate of $342 million.
Sales in the Power Systems segment rose 14% from the year-ago quarter to $1,160 million. The segment’s EBITDA decreased to $90 million (7.8% of sales) from $126 million (12.3% of sales) and lagged the consensus mark of $117 million. Power generation revenues increased 9% year over year, while industrial revenues soared 21%, owing to stronger demand in mining and oil and gas markets.
Sales in the New Power segment came in at $31 million, down 11% from the year-ago level. The segment incurred a pretax loss of $67 million. The loss was wider than the consensus mark of $65 million.
Financials
Cummins’ cash and cash equivalents were $2,276 million as of Mar 31, 2022, down from $2,592 million on Dec 31, 2021. Long-term debt totaled $3,502 million, down from $3,579 million on Dec 31, 2021.
Cummins raised its 2022 guidance for revenues. It expects revenues to grow 8% year over year compared with the previous estimate of 6%. EBITDA forecast remains unchanged at 15.5% of sales.
Zacks Rank & Key Picks
CMI currently carries a Zacks Rank #3 (Hold).
Better-ranked players in the auto space include BRP Group, Inc. (DOOO - Free Report) , sporting a Zacks Rank #1 (Strong Buy) and Dorman Products (DORM - Free Report) and Tesla Inc. (TSLA - Free Report) , each carrying a Zacks Rank #2 (Buy), currently. You can see the complete list of today’s Zacks #1 Rank stocks here.
BRP Group has an expected earnings growth rate of 9.1% for fiscal 2023. The Zacks Consensus Estimate for current-year earnings has been revised around 7.9% upward in the past 60 days.
BRP Group’s earnings beat the Zacks Consensus Estimate in all of the trailing four quarters. DOOO pulled off a trailing four-quarter earnings surprise of 68%, on average. The stock has declined 11% over the past year.
Dorman Products has an expected earnings growth rate of 18.8% for the current year. The Zacks Consensus Estimate for current-year earnings has been marginally revised 0.7% upwards in the past 60 days.
Dorman Products’ earnings beat the Zacks Consensus Estimate in three of the trailing four quarters and missed in one. DORM pulled off a trailing four-quarter earnings surprise of 3.1%, on average. The stock has lost 2.1% over the past year.
Tesla has an expected earnings growth rate of 66.1% for the current year. The Zacks Consensus Estimate for current-year earnings has been revised around 18.7% upward in the past 60 days.
Tesla’s earnings beat the Zacks Consensus Estimate in all of the trailing four quarters. TSLA pulled off a trailing four-quarter earnings surprise of 41.27%, on average. The stock has gained 31.8% over the past year.
Zacks Names "Single Best Pick to Double"
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.
This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.
Free: See Our Top Stock and 4 Runners Up >>
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