Cummins: Earnings Beat On The Way
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Passage Research4.92K FollowersFollow5ShareSavePlay(11min)CommentsFollow us on Google for the latest stock newsFollow Seeking Alpha on Google for the latest stock newsSummaryCummins is positioned for a Q1 earnings beat, with strong Power and Distribution segments offsetting heavy truck market weakness.CMI guides for 3–8% revenue growth and 17–18% EBITDA margin, with analyst day potentially raising multi-year margin targets.Despite a 26% YTD rally, CMI’s valuation at 24.9x forward P/E still offers upside, especially if margins improve at analyst day.Risks include diesel engine market share erosion in the energy transition and heavy truck industry cyclicality, but aftermarket exposure provides stability. RichLegg/E+ via Getty Images Cummins (CMI) is set to report earnings in a couple of weeks, and it's a good time to dust off the model and focus on what's ahead. The diesel engine maker has set forth an impressiveThis article was written byPassage Research4.92K FollowersFollowPassage Research focuses on identifying variant perception through a blend of fundamental analysis and alternative data. The research process combines detailed financial modeling with real-time datasets to underwrite earnings power, margin durability, and forward expectations.The author has spent over a decade on Wall Street, most recently spending the last five years working in the hedge fund industry as an analyst. Typical coverage spans consumer, TMT, industrials and special situations, with an emphasis on asymmetric risk/reward and catalyst-driven opportunities.Analyst’s Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, but may initiate a beneficial Long position through a purchase of the stock, or the purchase of call options or similar derivatives in CMI over the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article. Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.