Cummins (CMI) closed at $232.80 in the latest trading session, marking a -0.8% move from the prior day. This change was narrower than the S&P 500's daily loss of 0.94%. Elsewhere, the Dow lost 0.22%, while the tech-heavy Nasdaq lost 1.53%.
Heading into today, shares of the engine maker had gained 0.04% over the past month, lagging the Auto-Tires-Trucks sector's gain of 13.98% and the S&P 500's gain of 1.85% in that time.
Investors will be hoping for strength from Cummins as it approaches its next earnings release. In that report, analysts expect Cummins to post earnings of $4.77 per share. This would mark year-over-year growth of 48.6%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $8.21 billion, up 11.9% from the year-ago period.
For the full year, our Zacks Consensus Estimates are projecting earnings of $19.76 per share and revenue of $33.17 billion, which would represent changes of +30.69% and +18.14%, respectively, from the prior year.
Any recent changes to analyst estimates for Cummins should also be noted by investors. These revisions typically reflect the latest short-term business trends, which can change frequently. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.
Research indicates that these estimate revisions are directly correlated with near-term share price momentum. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.
The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection has moved 0.04% lower. Cummins is currently a Zacks Rank #3 (Hold).
In terms of valuation, Cummins is currently trading at a Forward P/E ratio of 11.88. For comparison, its industry has an average Forward P/E of 11.88, which means Cummins is trading at a no noticeable deviation to the group.
We can also see that CMI currently has a PEG ratio of 1.17. 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 1.17 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 113, which puts it in the top 45% 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.
Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.
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