Cummins Inc. (CMI) vs Otis Worldwide Corporation (OTIS)

Cummins Inc. and Otis Worldwide Corporation are both Specialty Industrial Machinery companies. Cummins Inc. is the larger, with a market value of $73.3B against $26.8B — 2.7× the size. Otis Worldwide Corporation trades at the lower P/E: 18.2× against 27.0×. Otis Worldwide Corporation grew revenue faster over the last twelve months: 5.24% against 2.93%. Otis Worldwide Corporation has the higher net margin (10.2% vs 7.82%) and the higher return on invested capital (69.4% vs 14.4%). Both pay a dividend; Otis Worldwide Corporation yields more (2.41% vs 1.54%). Across the 22 metrics below, Otis Worldwide Corporation leads on 16 and Cummins Inc. on 6.

Valuation

Metric CMI OTIS Specialty Industrial Machinery median
P/E 27.03 18.20 28.39
P/S 2.11 1.83 2.70
P/B 5.27 n/m 3.02
Price to free cash flow 21.76 15.70 23.32
EV/EBITDA 15.21 14.19 15.39
EV/Sales 2.20 2.34 2.81
Earnings yield 3.70% 5.50% 3.12%
Free cash flow yield 4.60% 6.37% 3.24%

Profitability

Metric CMI OTIS Specialty Industrial Machinery median
Gross margin 25.32% 30.17% 35.90%
Operating margin 11.22% 15.35% 11.22%
Net margin 7.82% 10.17% 7.80%
Free cash flow margin 9.70% 11.66% 9.51%
Return on equity 20.28% (28.00%) 10.50%
Return on assets 7.77% 14.00% 4.60%
Return on invested capital 14.42% 69.35% 5.36%

Growth

Metric CMI OTIS Specialty Industrial Machinery median
Revenue growth (TTM) 2.93% 5.24% 6.45%
EPS growth (last fiscal year) (27.74%) (14.00%) 4.97%
Revenue growth, 5-year CAGR 11.19% 2.50% 8.31%
Net income growth, 5-year CAGR 9.71% 8.84% 5.04%

Health

Metric CMI OTIS Specialty Industrial Machinery median
Debt to equity 0.50 (1.52) 0.35
Current ratio 1.73 0.83 2.11
Net debt to EBITDA 0.64 2.97 1.32

Dividend

Metric CMI OTIS Specialty Industrial Machinery median
Dividend yield 1.54% 2.41% 1.10%
Payout ratio 0.42 0.44 0.31

Size

Metric CMI OTIS Specialty Industrial Machinery median
Market cap 73.34b 26.80b 1.91b

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