CMI Relative Valuation
CMI's fair value is calculated using relative valuation, based on historical P/E and P/S ranges and their premiums/discounts relative to a competitor average, adjusted by weights. If the market price exceeds this fair value range, CMI is overvalued; if below, it's undervalued.
Historical Valuation
Cummins Inc (CMI) is now in the Overvalued zone, suggesting that its current forward PE ratio of 21.24 is considered Overvalued compared with the five-year average of 14.01. The fair price of Cummins Inc (CMI) is between 345.76 to 434.86 according to relative valuation methord. Compared to the current price of 510.74 USD , Cummins Inc is Overvalued By 17.45%.
Relative Value
Fair Zone
345.76-434.86
Current Price：510.74
17.45%
Overvalued
21.36
PE
1Y
3Y
5Y
Trailing
Forward
13.27
EV/EBITDA
Cummins Inc. (CMI) has a current EV/EBITDA of 13.27. The 5-year average EV/EBITDA is 9.01. The thresholds are as follows: Strongly Undervalued below 6.47, Undervalued between 6.47 and 7.74, Fairly Valued between 10.28 and 7.74, Overvalued between 10.28 and 11.55, and Strongly Overvalued above 11.55. The current Forward EV/EBITDA of 13.27 falls within the Strongly Overvalued range.
16.52
EV/EBIT
Cummins Inc. (CMI) has a current EV/EBIT of 16.52. The 5-year average EV/EBIT is 11.46. The thresholds are as follows: Strongly Undervalued below 8.38, Undervalued between 8.38 and 9.92, Fairly Valued between 13.00 and 9.92, Overvalued between 13.00 and 14.53, and Strongly Overvalued above 14.53. The current Forward EV/EBIT of 16.52 falls within the Strongly Overvalued range.
2.08
PS
Cummins Inc. (CMI) has a current PS of 2.08. The 5-year average PS is 1.25. The thresholds are as follows: Strongly Undervalued below 0.78, Undervalued between 0.78 and 1.02, Fairly Valued between 1.49 and 1.02, Overvalued between 1.49 and 1.73, and Strongly Overvalued above 1.73. The current Forward PS of 2.08 falls within the Strongly Overvalued range.
16.88
P/OCF
Cummins Inc. (CMI) has a current P/OCF of 16.88. The 5-year average P/OCF is 11.59. The thresholds are as follows: Strongly Undervalued below 8.15, Undervalued between 8.15 and 9.87, Fairly Valued between 13.30 and 9.87, Overvalued between 13.30 and 15.02, and Strongly Overvalued above 15.02. The current Forward P/OCF of 16.88 falls within the Strongly Overvalued range.
23.07
P/FCF
Cummins Inc. (CMI) has a current P/FCF of 23.07. The 5-year average P/FCF is 17.26. The thresholds are as follows: Strongly Undervalued below 7.84, Undervalued between 7.84 and 12.55, Fairly Valued between 21.97 and 12.55, Overvalued between 21.97 and 26.68, and Strongly Overvalued above 26.68. The current Forward P/FCF of 23.07 falls within the Overvalued range.
Cummins Inc (CMI) has a current Price-to-Book (P/B) ratio of 5.81. Compared to its 3-year average P/B ratio of 4.08 , the current P/B ratio is approximately 42.52% higher. Relative to its 5-year average P/B ratio of 4.05, the current P/B ratio is about 43.41% higher. Cummins Inc (CMI) has a Forward Free Cash Flow (FCF) yield of approximately 0.00%. Compared to its 3-year average FCF yield of 3.58%, the current FCF yield is approximately -100.00% lower. Relative to its 5-year average FCF yield of 4.35% , the current FCF yield is about -100.00% lower.
5.84
P/B
Median3y
4.08
Median5y
4.05
3.25
FCF Yield
Median3y
3.58
Median5y
4.35
Competitors Valuation Multiple
The average P/S ratio for CMI's competitors is , providing a benchmark for relative valuation. Cummins Inc Corp (CMI) exhibits a P/S ratio of , which is NaN% above the industry average. Given its robust revenue growth of -1.64%, this premium appears unsustainable.
P/S
P/E
EV/EBITDA
EV/EBIT
P/S
Revenue Growth
Market Cap
Performance Decomposition
1Y
3Y
5Y
Market capitalization of CMI increased by 46.51% over the past 1 year. The primary factor behind the change was an increase in P/E Change from 14.67 to 26.52.
The secondary factor is the Revenue Growth, contributed -1.64%to the performance.
Overall, the performance of CMI in the past 1 year is driven by P/E Change. Which is more unsustainable.
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