Buying Companies with Great Products – Cummins (CMI) – Part II

Summary

• In Part I, we screened out FOXF and GTX and did a deeper analysis of SNA
• In Part II below, we’ll analyze Cummins, Inc (CMI)

Cummins (CMI)

Overview

Cummins Inc. primarily designs, manufactures, distributes, and services diesel and natural gas engines, as well as components like turbochargers. Although it’s a different kind of industrial from Snap-On, CMI’s fortunes will mostly rise and fall with the worldwide sale of trucks, which is probably peaking for this cycle.

Let’s get into it.

Key Stats, Metrics, and Financials

CMI’s valuation stats are mostly at the low end of their 10-year range, though its Book metrics are more in line with history:

Returns on Invested Capital, Assets, and Equity...