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Cummins (CMI) Q2 Earnings Miss Estimates, Revenues Top
August 01, 2017

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Cummins Inc. (CMI - Free Report) is a leading global designer, manufacturer and distributor of diesel and natural gas engines, electric power generation systems, and engine-related components, fuel systems, controls and air handling systems. Cummins is poised to benefit from its innovative products, rising demand for its engines among OEMs, and focus on cost reduction. Further, Cummins’ Distribution segment is poised to gain from the acquisitions in North America and expansion through partnerships.

Estimate Trend & Surprise History

Investors should note that the second-quarter earnings estimate for Cummins have been rising over the last 7 days.

The company has delivered positive earnings surprises in recent quarters. It surpassed the Zacks Consensus Estimate in all of the trailing four quarters with an average beat of around 14.52%. Thus, investors have been eagerly awaiting Cummins’ latest earnings report.

We have highlighted some of the key stats from this just-revealed announcement below:

Earnings

Cummins’ earnings reported earnings of $2.53 per share in the second quarter of 2017, missing the Zacks Consensus Estimate of $2.58.

Cummins Inc. Price and EPS Surprise

Revenues

Cummins reported revenues of $5.08 billion, up 12% year over year. Revenues also surpassed the Zacks Consensus Estimate of $4.79 billion. This was due to increased demand of trucks and construction equipment in North America and China.

Key Stats/Developments to Note

For 2017, Cummins anticipates revenues to grow by 9-11%, compared to the prior guidance of 4-6% growth in revenues. EBIT is expected in the range of 11.75–12.5%, unchanged from the previous guidance. These expectations exclude the impact of the joint venture between Cummins and Eaton. The joint venture, launched in Apr 2017, is known as Eaton Cummins Automated Transmission Technologies.

Zacks Rank

Currently, Cummins has a Zacks Rank #2 (Buy), but that could change following its earnings report which was just released. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Market Reaction

Cummins’ shares have declined 5.17% in the pre-trading session so far. It would be interesting to see how the market reacts to the results during the trading session today.

Check back later for our full write up on Cummins’ earnings report!

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