CMI
Cummins
Hybrid Industrial
★ Quality 54/100Price today
$667.03
what the market pays
Worth
$243.53
calculated cycle value
Price is 174% above its value
charlieapp.co
Price vs Intrinsic Value
The line is the price month by month; the green band marks when it's undervalued (−20% off value). When the price drops in there, the discount is real, not opinion.
Where does the value come from?
Manufacturing + technology
$266.48
per share
How it's calculated
Cummins — high assistant score (2026-06-07). Check note.
Net cash in the bank
cash minus financial debt, per share
Total calculated value
business + cash
How many times the cash flow
Hybrid Industrial · vs 28 peers
You pay 38x times this business's cash flow; its sector median is 33.7x.
61% above what Charlie thinks it's worth (14.7x) — you're overpaying, sector or no sector.
Why Overvalued?
Its free cash flow is $18.14/share × 14.7x multiplier minus $22.95 in negative net cash = $243.53 in intrinsic value. Today's price of $667.03 is 63% above the calculated value — the market is paying a premium over what the model sees as fair.
The price is 174% above the calculated value. You're paying more than it's worth.
Buying here lowers your expected return and wipes out the safety margin.
The next reasonable entry zone starts at $231.35.
At what price would buying make sense?
Entry zones
🟢 Undervalued
≤$194.82
-20% off Value
🟡 Discounted
≤$231.35
-5% off Value
🔴 Today
$667.03
-64% Valor
Overvalued
The market prices it too high versus what the business makes. Patience pays off here.
“Time is the friend of the wonderful company, the enemy of the mediocre.”
— Warren Buffett
Model updated · July 2026
The business
Cummins sells the engine once and the parts for decades.
Cummins designs and manufactures diesel and natural gas engines, power generation systems, and components for trucks, industrial equipment, and mining. It charges for equipment sales plus a recurring stream of parts and aftermarket service. 2025 revenue: $33.7B.
The moat lives in the installed base: millions of engines that need parts and maintenance for decades. Emissions regulations make it costly to enter, and truck makers have been specifying Cummins for generations. It's not a wide moat — the 25% gross margin says so.
Revenue history
From $24.0B to $33.7B in 4 years. The business grows steadily.
Where each $100 of sales goes
Revenue $33.7B · FY2025
Of every $100 in sales, $92 goes to costs and operations; $8 is left as net profit (8% margin).
Catalysts and risks
Accelera division (electrolysis and hydrogen) scaling toward profitability by 2027.
Fuel-agnostic X15 engine with mass production from 2026-2027.
Fleet renewal pre-buy ahead of new EPA 2027 rules on heavy trucks.
Cyclical business tied to heavy trucks and construction: a recession cuts orders fast.
Transition to electric threatens the diesel core; Accelera still burns cash.
Net Income reported at ~$0B in 2025 signals extraordinary charges worth auditing.
Charlie's note
“A good cyclical business sold at an excellent-business price rarely pays off. At 14.7x with a 25% margin and no wide moat, you're paying for the brand and praying for the cycle.”
Analysis · June 2026
So when would be a good price for Cummins?
By our calculation, not yet. We will email you the day it drops to $231.35 — so you do not have to keep checking.
🔔 Email meFree · no card
Charlie informs, it doesn't advise. No information should be taken as a recommendation to buy or sell.