Cummins Inc. (CMI) shares are trading at higher $231.17 and the avg recommendation for the stock is Moderate Buy, while the current analyst price target stands at $241.53.
To add more color to this target, the company’s high over the last year is $244.67 and the low is $101.03. Over the last 52 weeks, CMI is up 26.42% while the S&P 500 is up 15.19%. The catalyst for this interesting swing was the company’s recent earnings report.
A Notable Earnings Report
In the last quarter, CMI reported a profit of $1.35 billion. Cummins Inc. also saw revenues increase to $5.12 billion. In addition, CMI has free cash flow of $1.31 billion as of 09-2020. The company’s EBITDA came in at $836.0 million which compares well with its peers.
CMI booked profit margins of 8.10%, its Return on Equity (ROE) is 21.60%, and its Return on Assets is 7.80%. All told, it is clear that, CMI needs to be on your watchlist.
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Of course, we must look beyond the financials and question how well those numbers represent the sustainable earnings power of the business. Investors need to know how sustainable this current run. CMI has a short ratio of 2.77 and outstanding shares of 147.90M.
CMI has seen increased volume after this news and investors are putting their support behind the value proposition. Furthermore, 10-day volume stands at 1.0 million and more growth is possible in the weeks ahead. Traders will also note the company’s earnings per share came in at 10.61. Cummins Inc. CMI also noted assets of $21.57 billion at the end of the last quarter. Investors should also keep an eye on sector updates as CMI has historically followed its peers on positive news.
All told, Cummins Inc. CMI has strung together solid data and demonstrated underlying fundamentals. At its current valuation, CMI represents an interesting risk/reward case. Traders should stay tuned to see if this recent report will push the stock to test recent resistance levels.
Cummins Inc. CMI is now commanding a market cap of 34.42B and a float of 147.50M. CMI is increasing its credibility in this sector and that could lead to more upside down the line. Sign-up for continuing coverage on shares of CMI stock, as well as other hot stock picks, get our free newsletter today and get our next breakout pick!
Disclosure: we hold no position in CMI, either long or short, and we have not been compensated for this article.