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Cummins Inc - Stock Quote CMI

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Morningstar's Cummins Inc Stock Analysis

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Cummins Grows Its Top Line, but Its Suspension of Operations in Russia Leads to Lower EBITDA Margins

Dawit Woldemariam Equity Analyst

Analyst Note

| Dawit Woldemariam |

Narrow-moat-rated Cummins reported solid first-quarter results despite a challenging supply chain environment. The company’s top line grew nearly 5% year on year to $6.3 billion in the quarter, largely due to strong new engine and aftermarket sales. Management highlighted that freight demand remains strong globally, except for China, which is trending lower due to declining on-highway and construction sales. Excluding China, global demand looks healthy, as retailer restocking is strong and industrial activity continues to improve. While the trucking industry continues to be constrained by the components shortage, we think there is pent-up demand in the market, given high truck utilization rates and elevated fleet ages. As the supply chain environment improves throughout 2022, we think Cummins will be ready to meet customer demand.

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Cummins Inc's Company Profile

Business Description

Cummins is the top manufacturer of diesel engines used in commercial trucks, off-highway equipment, and railroad locomotives, in addition to standby and prime power generators. The company also sells powertrain components, which include filtration products, transmissions, turbochargers, aftertreatment systems, and fuel systems. Cummins is in the unique position of competing with its primary customers, heavy-duty truck manufacturers, who make and aggressively market their own engines. Despite robust competition across all its segments and increasing government regulation of diesel emissions, Cummins has maintained its leadership position in the industry.

500 Jackson Street, Box 3005
Columbus, IN, 47202-3005
T +1 812 377-5000
Sector Industrials
Industry Specialty Industrial Machinery
Most Recent Earnings Mar 31, 2022
Fiscal Year End Dec 31, 2022
Stock Type Cyclical
Employees 59,900

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