Cummins (CMI) Gains As Market Dips: What You Should Know
Cummins (CMI) closed at $244.29 in the latest trading session, marking a +0.16% move from the prior day. This move outpaced the S&P 500's daily loss of 0.08%. At the same time, the Dow lost 0.34%, and the tech-heavy Nasdaq gained 11.55%.
Prior to today's trading, shares of the engine maker had gained 2.42% over the past month. This has outpaced the Auto-Tires-Trucks sector's loss of 20.56% and the S&P 500's loss of 1.03% in that time.
Investors will be hoping for strength from Cummins as it approaches its next earnings release. The company is expected to report EPS of $4.98, up 74.74% from the prior-year quarter. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $7.34 billion, up 25.52% from the year-ago period.
Investors might also notice recent changes to analyst estimates for Cummins. These revisions help to show the ever-changing nature of near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.
Our research shows that these estimate changes are directly correlated with near-term stock prices. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.
Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Within the past 30 days, our consensus EPS projection has moved 0.13% higher. Cummins is currently a Zacks Rank #3 (Hold).
In terms of valuation, Cummins is currently trading at a Forward P/E ratio of 11.64. This represents a premium compared to its industry's average Forward P/E of 10.89.
Meanwhile, CMI's PEG ratio is currently 1.28. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. The Automotive - Internal Combustion Engines was holding an average PEG ratio of 1.28 at yesterday's closing price.
The Automotive - Internal Combustion Engines industry is part of the Auto-Tires-Trucks sector. This industry currently has a Zacks Industry Rank of 24, which puts it in the top 10% of all 250+ industries.
The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
You can find more information on all of these metrics, and much more, on Zacks.com.
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Cummins Inc. (CMI) : Free Stock Analysis Report
