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Valued at a market cap of almost $49.4 billion, Cummins Inc. (CMI) designs, manufactures, distributes, and services diesel and natural gas engines, electric and hybrid powertrains, and related components. The Columbus, Indiana-based company is expected to announce its fiscal Q4 earnings results on Tuesday, Feb. 4.
Ahead of this event, analysts project the specialty industrial machinery company to report a profit of $4.71 per share, up 13.8% from $4.14 per share in the year-ago quarter. The company has surpassed Wall Street's earnings estimates in two of the last four quarters while missing on other two occasions. In Q3, CMI’s adjusted EPS of $5.60 outpaced the forecasted figure by a solid margin of 14.5%.
For fiscal 2024, analysts expect CMI to report an EPS of $20.75, up 5.4% from $19.69 in fiscal 2023.
Shares of CMI have rallied 49.2% over the past 52 weeks, significantly outperforming both the S&P 500 Index's ($SPX) 24.4% rise and the Industrial Select Sector SPDR Fund’s (XLI) 18.4% return over the same time frame.
On Nov. 5, CMI’s stock soared 8.9% after its better-than-expected Q3 earnings release. The company’s revenue remained unchanged at $8.5 billion and surpassed the Wall Street estimates of $8.31. Its robust international revenue growth was somewhat offset by challenges in its North American heavy-duty truck market. On the other hand, its adjusted EPS of $5.60 climbed 18.4% from the year-ago quarter and outpaced the forecasted figure by 14.5%. The bottom-line growth was primarily fueled by a 180-bps expansion in its EBITDA margin.
Moreover, CMI raised its full-year 2024 EBITDA guidance to 15.5%, which might have further bolstered investor confidence.
Wall Street analysts are moderately optimistic about Cummins’ stock, with a "Moderate Buy" rating overall. Among 18 analysts covering the stock, five recommend "Strong Buy," one indicates a “Moderate Buy,” 11 suggest “Hold,” and one suggests a “Moderate Sell” rating. This configuration is slightly more bullish than two months ago, with four analysts suggesting a “Strong Buy.”
The mean price target for CMI is $382.53, which indicates a modest 6.3% potential upside from the current levels.
On the date of publication, Neharika Jain did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
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