Cummins Inc (CMI)
Profitability ratios
Return on sales
| Dec 31, 2024 | Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Gross profit margin | 24.75% | 24.58% | 24.31% | 24.29% | 24.22% | 24.23% | 23.72% | 23.94% | 23.93% | 23.77% | 24.16% | 23.61% | 23.71% | 23.91% | 24.51% | 24.34% | 24.70% | 24.78% | 24.70% | 25.43% |
| Operating profit margin | 11.00% | 5.28% | 4.99% | 4.87% | 5.17% | 11.34% | 10.72% | 11.12% | 10.43% | 10.03% | 10.74% | 10.28% | 11.27% | 11.83% | 12.28% | 11.70% | 11.45% | 10.19% | 10.01% | 11.23% |
| Pretax margin | 11.28% | 8.42% | 7.94% | 7.92% | 4.46% | 10.68% | 10.28% | 10.71% | 9.93% | 9.67% | 10.48% | 10.35% | 11.32% | 15.40% | 16.03% | 15.86% | 16.03% | 15.69% | 15.57% | 16.11% |
| Net profit margin | 8.83% | 6.13% | 5.69% | 5.70% | 2.16% | 8.40% | 7.89% | 8.37% | 7.66% | 7.32% | 8.26% | 8.00% | 8.87% | 12.91% | 13.24% | 13.12% | 13.37% | 13.30% | 13.47% | 13.82% |
Cummins Inc's profitability ratios show a mixed trend over the period under analysis. The gross profit margin fluctuated between 23.61% and 24.75%, indicating relatively consistent performance in generating profits from sales after deducting the cost of goods sold.
Meanwhile, the operating profit margin fluctuated between 4.87% and 12.28%, displaying greater variability compared to the gross margin. This ratio measures the company's ability to generate profits from its core operations before considering interest and taxes, highlighting some fluctuations in operational efficiency and cost management.
Furthermore, the pretax margin varied between 4.46% and 16.11%, reflecting the company's ability to generate profits before paying taxes. The significant fluctuations in this margin indicate that Cummins Inc's profitability was impacted by various factors such as operating expenses and non-operating income over the period.
Lastly, the net profit margin showed similar fluctuations, ranging from 2.16% to 13.82%. This margin represents the percentage of revenue that ultimately translates into net income after accounting for all expenses, including taxes. The declining trend in net profit margin suggests challenges in controlling costs or maintaining revenue growth relative to expenses.
Overall, while Cummins Inc demonstrated some consistency in gross profit margin, its operating, pretax, and net profit margins displayed more volatility, indicating potential challenges in managing costs and sustaining profitability levels over the period.
Return on investment
| Dec 31, 2024 | Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Operating return on assets (Operating ROA) | 11.89% | 5.63% | 5.45% | 5.21% | 5.50% | 11.76% | 10.87% | 10.66% | 9.67% | 8.81% | 10.88% | 10.36% | 11.41% | 12.31% | 12.58% | 10.65% | 10.03% | 9.25% | 9.96% | 12.63% |
| Return on assets (ROA) | 9.55% | 6.54% | 6.21% | 6.09% | 2.30% | 8.71% | 8.01% | 8.03% | 7.10% | 6.43% | 8.37% | 8.07% | 8.99% | 13.43% | 13.56% | 11.94% | 11.71% | 12.06% | 13.40% | 15.55% |
| Return on total capital | 22.16% | 10.18% | 10.26% | 10.66% | 11.57% | 21.45% | 19.59% | 19.70% | 17.89% | 16.37% | 20.72% | 20.01% | 21.46% | 22.96% | 23.37% | 19.64% | 17.83% | 16.30% | 17.69% | 23.63% |
| Return on equity (ROE) | 29.32% | 20.33% | 20.35% | 21.37% | 8.31% | 26.24% | 24.58% | 26.22% | 23.97% | 22.84% | 23.44% | 23.07% | 26.16% | 38.33% | 38.97% | 33.80% | 32.86% | 33.78% | 37.85% | 44.16% |
Cummins Inc's profitability ratios show fluctuations over the period from March 31, 2020, to December 31, 2024.
1. Operating return on assets (Operating ROA) ranged from a high of 12.63% on March 31, 2020, to a low of 5.21% on March 31, 2024. The ratio improved in the subsequent periods but experienced a significant decline to 5.50% on December 31, 2023.
2. Return on assets (ROA) peaked at 15.55% on March 31, 2020, and gradually decreased over the years. The ratio fell to 2.30% on December 31, 2023, before rebounding to 9.55% on December 31, 2024.
3. Return on total capital exhibited a similar pattern, with a high of 23.63% on March 31, 2020, and a low of 10.18% on September 30, 2024. The ratio has shown some volatility but ended the period December 31, 2024 at 22.16%.
4. Return on equity (ROE) followed a comparable trend with a peak of 44.16% on March 31, 2020, and a trough of 8.31% on December 31, 2023. The ratio recovered to 29.32% by December 31, 2024.
Overall, while there were fluctuations in profitability ratios, Cummins Inc managed to maintain positive returns on assets, capital, and equity throughout the period, with the potential for improvement based on the observed trends. Monitoring these ratios will be crucial for assessing the company's financial performance and making informed investment decisions.