CumminsCMI -4.33%84 Interest Coverage is 13.16 as of Mar. 2026, which is 31% below its 10-year median of 19.15. GuruFocus rates CMI with a GF Score™ of 84/100 and a GF Value™ of $326.29 (Significantly Overvalued). The stock has 10 warning signs investors should review. Among 2,325 Industrial Products companies, Cummins ranks worse than 55.27% on this metric.
Interest Coverage is a ratio that determines how easily a company can pay interest expenses on outstanding debt. It is calculated by dividing a company's
Operating Income
by its Interest Expense. Cummins's
Operating Income
for the
three
months ended in Mar. 2026 was $1,000 Mil. Cummins's Interest Expense for the
three
months ended in Mar. 2026 was $-76 Mil.
Cummins's interest coverage for the quarter that ended in Mar. 2026 was 13.16.
The higher the ratio, the stronger the company's financial strength is.
The historical rank and industry rank for Cummins's Interest Coverage or its related term are showing as below:
CMI'
s Interest Coverage Range Over the Past 10 Years
Min: 3.41 Med: 19.15 Max: 25.12
Current: 11.74
CMI's Interest Coverage is ranked worse than 55.27% of 2325
companies
in the Industrial Products industry
Industry Median: 14.8
vs CMI: 11.74
Ben Graham requires that a company has a minimum interest coverage of 5 with the companies he invested. If the interest coverage is less than 2, the company is burdened by debt. Any business slow or recession may drag the company into a situation where it cannot pay the interest on its debt.
Interest Coverage is an important factor when GuruFocus ranks a company's overage Financial Strength .
Cummins Interest Coverage Related Terms
Cummins Interest Coverage Historical Data
* Premium members only.
The historical data trend for Cummins's Interest Coverage can be seen below:
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
Note: For Interest Coverage, "No debt" indicates no long-term debt. An indication of "No Debt" does not necessarily mean that the company has no long-term debt obligations; it could be due to missing data in the quarterly or annual report. Use caution when interpreting this information.
For the Specialty Industrial Machinery subindustry, Cummins's Interest Coverage, along with its competitors' market caps and Interest Coverage data, can be viewed below:
* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.
Cummins Interest Coverage vs Industrial Products Industry
For the Industrial Products industry and Industrials sector, Cummins's Interest Coverage distribution charts can be found below:
* The bar in red indicates where Cummins's Interest Coverage falls into.
Interest Coverage is a ratio that determines how easily a company can pay interest expenses on outstanding debt. It is calculated by dividing a company's Operating Income (EBIT) by its Interest Expense:
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
Cummins (CMI) has a Interest Coverage of 13.16 as of Mar. 2026. Interest Coverage measures a company's capability to pay interest expenses on its debt. View historical data on Cummins and its competitors. This is 31% below median its historical median of 19.15. Over the past decade, Cummins' Interest Coverage has ranged from 3.41 to 25.12. According to the industry distribution chart, Cummins ranks #1285 out of 2325 companies in the Industrial Products industry, placing it in the top 55.3%.
Is Cummins' Interest Coverage too high?
Cummins' current Interest Coverage of 13.16 is 31% below median its 10-year median of 19.15. Over the past 10 years, this metric has ranged from a low of 3.41 to a high of 25.12. The Industrial Products industry median Interest Coverage is 14.80. Cummins' value of 13.16 is 11.1% below this industry median. Based on the distribution chart, Cummins ranks #1285 out of 2325 companies in the Industrial Products industry, which is below the industry midpoint. Overall, Cummins has a GF Score™ of 84/100 and is considered Significantly Overvalued, reflecting its overall financial health beyond just this single metric.
How does Cummins' Interest Coverage compare to EMR and ITW?
According to the Industrial Products industry distribution chart, Cummins ranks #1285 out of 2325 companies for Interest Coverage. This places Cummins in the lower half of its industry. The industry median Interest Coverage is 14.80. Cummins' value of 13.16 is 11.1% below this benchmark. Historically, Cummins' own Interest Coverage has ranged from 3.41 to 25.12 over the past decade. While the company's 10-year median is 19.15 vs. the industry median of 14.80, Cummins has consistently been below the industry average. See the competitive comparison table and distribution chart on this page for a detailed peer-by-peer breakdown.
What is a good Interest Coverage for an Industrial Products company?
The median Interest Coverage among Industrial Products companies is 14.80, based on 2,325 companies in the industry. Companies in the top quartile (top 25%) have a Interest Coverage significantly above this median, while those in the bottom quartile fall well below. However, Interest Coverage should not be evaluated in isolation — investors should consider it alongside profitability, growth, and financial strength metrics. Cummins's current Interest Coverage of 13.16 is 11.1% below the industry median. Use the industry distribution chart on this page to see where any company falls relative to its peers.
What does a high Interest Coverage mean?
A high Interest Coverage can signal that a stock is expensive relative to its fundamentals. Interest Coverage measures a company's capability to pay interest expenses on its debt. View historical data on Cummins and its competitors. For the Industrial Products industry, the median Interest Coverage is 14.80 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Cummins's current Interest Coverage is 13.16, which is 31% below median its own 10-year median of 19.15. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Cummins stock overvalued right now?
Based on GuruFocus' analysis, Cummins (CMI) is currently considered Significantly Overvalued. The stock's GF Value™ is $326.29, compared to a current price of $682.32 — trading 109.1% above its estimated fair value. The current Interest Coverage is 13.16, which is 31% below median its 10-year median of 19.15 and 11.1% below the Industrial Products industry median of 14.80. Cummins' overall GF Score™ is 84/100 with 10 warning signs to review. Investors should evaluate multiple metrics — including profitability, growth, and financial strength — before making a decision.
How is Interest Coverage calculated?
Interest Coverage is calculated from a company's financial statements. For Cummins (CMI), the current Interest Coverage is 13.16 as of Mar. 2026. GuruFocus calculates this using data sourced from SEC filings and annual reports. See the calculation section and 30-year financial data on this page for the full breakdown.
Is Cummins (CMI) Overvalued in 2026?
Based on GuruFocus' analysis, Cummins stock appears to be overvalued.
The current stock price of $682.32 is trading 109.1% above its estimated GF Value™ of $326.29.
GuruFocus considers Cummins to be Significantly Overvalued.
Key valuation signals for CMI:
Interest Coverage: 13.16 (31% below median its 10-year median of 19.15)
GF Value™: $326.29 vs. price of $682.32 (109.1% above fair value)
Industry Position: 11.1% below the Industrial Products median (#1285 of 2325)
No single metric tells the full story. See the CMI stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Cummins is a leading manufacturer of diesel and other engines used in heavy- and medium-duty commercial trucks, off-highway equipment, and locomotives, in addition to prime power and standby generators. The company also sells powertrain components, which include filtration products, transmissions, turbochargers, aftertreatment systems, and fuel systems. Sales are approximately 60% US and Canada and 40% rest of the world. Much of Cummins' foreign sales (China, India, and so forth) are through joint ventures. The company operates 650 distributors and over 19,000 dealer locations across 190 countries. Cummins' business model is unique as it competes with many of its heavy-duty truck manufacturer customers, which also make their own engines.
84GF Score
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