CMI
Cummins Inc (Ex. Cummins Engine Inc)
Industrial/Transportation
06/25/2015
Presented
| Date | 06/22/2015 |
| Price | $135.70 |
| Market Cap | N/A |
| Ent Value | $24.43B |
| P/E Ratio | 14.5x |
| Book Value | $42.74 |
| Div Yield | 2.3% |
| Shares O/S | 180.31M |
| Ave Daily Vol | 1,410,000 |
| Short Int | 3.29% |
Current
| Price | $332.68 |
| Market Cap | $45.59B |
| Cummins Inc. designs, manufactures, distributes, and services diesel and natural gas engines, and engine-related component products. It operates through four segments: Engine, Distribution, Components, and Power Generation. The Engine segment offers various diesel and natural gas powered engines under the Cummins and other customer brand names for the heavy-and medium-duty truck, bus, recreational vehicle, light-duty automotive, agricultural, construction, mining, marine, oil and gas, rail, and governmental equipment markets. This segment also provides new parts and service, as well as remanufactured parts and engines. The Distribution segment distributes and services parts and filtration products, power generation products, and engines, as well as offers service solutions, including maintenance contracts, engineering services, and integrated products. The Components segment offers emission solutions, including custom engineering systems and integrated controls, oxidation catalysts, particulate filters, oxides of nitrogen reduction systems, and engineered components; turbochargers for light-duty, mid-range, heavy-duty, and high-horsepower diesel markets; air filters, fuel filters, fuel water separators, lube filters, hydraulic filters, coolant, diesel exhaust fluid, fuel additives, and other filtration systems; and fuel systems primarily for heavy-duty on-highway diesel engine applications, as well as remanufactures fuel systems. The Power Generation segment designs and manufactures components that make up power generation systems, including controls, alternators, transfer switches, and switchgears, as well as provides power generation systems, components, and services. The company sells its products to original equipment manufacturers, distributors, and other customers worldwide. Cummins Inc. was founded in 1919 and is headquartered in Columbus, Indiana. |
Public companies mentioned in the summary notes: Cummins Inc. (CMI), Caterpillar (CAT), Navistar (NAV) and PACCAR (PCAR)
Highlights
While conceding that Cummins has operated a fantastic business with impressive earnings growth over a multi-year period, the presenter believes the business is poised to transition to a merely good - and ultimately, perhaps not so great - business. The company over the past 15 years has been the net beneficiary of a perfect storm of demand, based in part on emissions cycles, a key competitor in Caterpillar (CAT) exiting the market, and missteps on the part of Navistar (NAV), another major competitor. During that period its North American market share doubled and the price of engines has increased about 50 percent, but the presenter believes CMI will likely struggle to grow earnings going forward.
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