Cummins (CMI) Rises Yet Lags Behind Market: Some Facts Worth Knowing
In the latest market close, Cummins (CMI) reached $242.35, with a +0.34% movement compared to the previous day. The stock's performance was behind the S&P 500's daily gain of 0.45%.
The upcoming earnings release of Cummins will be of great interest to investors. The company's earnings per share (EPS) are projected to be $4.40, reflecting a 2.65% decrease from the same quarter last year. Meanwhile, the latest consensus estimate predicts the revenue to be $8.07 billion, indicating a 3.89% increase compared to the same quarter of the previous year.
In terms of the entire fiscal year, the Zacks Consensus Estimates predict earnings of $19.67 per share and a revenue of $33.59 billion, indicating changes of +30.09% and +19.66%, respectively, from the former year.
Investors should also note any recent changes to analyst estimates for Cummins. Recent revisions tend to reflect the latest near-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.
Our research suggests that these changes in estimates have a direct relationship with upcoming 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, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Over the last 30 days, the Zacks Consensus EPS estimate has moved 0.01% lower. At present, Cummins boasts a Zacks Rank of #3 (Hold).
From a valuation perspective, Cummins is currently exchanging hands at a Forward P/E ratio of 12.28. For comparison, its industry has an average Forward P/E of 12.62, which means Cummins is trading at a discount to the group.
Investors should also note that CMI has a PEG ratio of 1.29 right now. The PEG ratio bears resemblance to the frequently used P/E ratio, but this parameter also includes the company's expected earnings growth trajectory. The average PEG ratio for the Automotive - Internal Combustion Engines industry stood at 1.32 at the close of the market yesterday.
The Automotive - Internal Combustion Engines industry is part of the Auto-Tires-Trucks sector. With its current Zacks Industry Rank of 92, this industry ranks in the top 37% of all industries, numbering over 250.
The Zacks Industry Rank assesses the strength of our separate industry groups by calculating the average Zacks Rank of the individual stocks contained within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Remember to apply Zacks.com to follow these and more stock-moving metrics during the upcoming trading sessions.
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Cummins Inc. (CMI) : Free Stock Analysis Report
