CMI Price Forecast Based on Dividend Discount Model

A technique commonly used by dividend investors to value dividend-issuing stocks is the Dividend Discount Model (DDM), which seeks to determine a fair share price based on the dividend provided by the company relative to a number of other company-specific factors. Regarding Cummins Inc, the dividend discount model StockNews created for the company implies a negative return of 7.84%. To help understand and contextualize the model's evaluation of CMI, investors may wish to consider are:

• As for its position relative to other Industrials stocks that issue dividends, Cummins Inc offers a higher dividend yield than 77.17% of them.
• In comparison to other US listed dividend yielding stocks in the Industrials sector, the expected return of -7.84%, based on the stock's current share price and target price based on a dividend discount model, is greater than 81.74% of the DDM-forecasted return of its its sector peers.
• Out of all stocks in our universe of US-listed dividend-issuing stocks, CMI has a discount rate lower than 81.74% of them (a lower discount rate is associated with lower risk).

CMI Dividends vs. Peers