The 10-second takeaway
For the quarter ended April 1 (Q1), Cummins beat slightly on revenues and beat expectations on earnings per share.
Compared to the prior-year quarter, revenue increased significantly and GAAP earnings per share improved significantly.
Margins grew across the board.
Cummins reported revenue of $4.47 billion. The 13 analysts polled by S&P Capital IQ predicted net sales of $4.40 billion on the same basis. GAAP reported sales were 16% higher than the prior-year quarter's $3.86 billion.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.
EPS came in at $2.38. The 18 earnings estimates compiled by S&P Capital IQ anticipated $2.20 per share. GAAP EPS of $2.38 for Q1 were 36% higher than the prior-year quarter's $1.75 per share.
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.
For the quarter, gross margin was 26.8%, 200 basis points better than the prior-year quarter. Operating margin was 12.2%, 80 basis points better than the prior-year quarter. Net margin was 10.2%, 130 basis points better than the prior-year quarter.
Next quarter's average estimate for revenue is $5.14 billion. On the bottom line, the average EPS estimate is $2.68.
Next year's average estimate for revenue is $20.09 billion. The average EPS estimate is $10.36.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Cummins is outperform, with an average price target of $130.73.
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Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor of Motley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. Motley Fool newsletter services have recommended buying shares of Cummins. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.