Balance Sheet: Assets
The balance sheet provides creditors, investors, and analysts with information on company resources (assets) and its sources of capital (its equity and liabilities). It normally also provides information about the future earnings capacity of a company assets as well as an indication of cash flows that may come from receivables and inventories.
Assets are resources controlled by the company as a result of past events and from which future economic benefits are expected to flow to the entity.
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- Analysis of Profitability Ratios
- Analysis of Reportable Segments
- Enterprise Value to FCFF (EV/FCFF)
- Dividend Discount Model (DDM)
- Net Profit Margin since 2005
- Return on Equity (ROE) since 2005
- Return on Assets (ROA) since 2005
- Debt to Equity since 2005
- Price to Operating Profit (P/OP) since 2005
- Price to Book Value (P/BV) since 2005
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Cummins Inc., consolidated balance sheet: assets
US$ in millions
Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).
The analysis of the financial data over the five-year period reveals several notable trends in the company's asset composition and overall growth.
- Liquidity and Cash Reserves
- Cash and cash equivalents showed a significant increase from 2019 to 2020, rising from 1,129 million USD to 3,401 million USD. However, this was followed by a downward adjustment in 2021 and 2022, stabilizing slightly above 2,100 million USD in 2023. Marketable securities gradually increased across the period, contributing to the total of cash, cash equivalents, and marketable securities, which peaked in 2020 at 3,862 million USD and then experienced a decline but remained above 2,500 million USD thereafter.
- Receivables and Inventories
- Accounts and notes receivable exhibited a steady increase, growing from 3,670 million USD in 2019 to 5,583 million USD in 2023, indicating expanding credit sales or extended payment terms. Inventories followed a similar upward trajectory, with a notable acceleration starting in 2021, reaching 5,677 million USD in 2023, which could suggest increased production, stockpiling, or a response to demand growth.
- Current Assets and Prepaid Expenses
- Current assets increased consistently from 9,387 million USD in 2019 to 15,198 million USD in 2023, reflecting overall asset growth and enhanced short-term resource availability. Prepaid expenses and other current assets also showed an upward trend, nearly doubling between 2019 and 2023, indicating higher advance payments or deferred charges.
- Long-term Assets and Fixed Assets
- Property, plant, and equipment net values increased steadily, especially between 2021 and 2023, suggesting ongoing capital investments and asset growth. Investments related to equity method investees increased modestly over the period, while goodwill and other intangible assets exhibited substantial jumps starting 2022, with goodwill almost doubling, likely attributable to acquisitions or asset revaluations.
- Pension and Other Assets
- Pension assets initially rose from 2019 to 2021 but decreased thereafter, potentially reflecting changes in pension fund valuations or payments. Deferred income taxes showed irregular growth, with a marked increase in 2023. Corporate-owned life insurance assets declined gradually overall, and other assets rose steadily, supporting the trend in total long-term assets.
- Total Asset Growth
- The total assets increased from 19,737 million USD in 2019 to 32,005 million USD in 2023, representing a significant expansion in the company’s asset base. This growth was driven by increases across both current and long-term asset categories, highlighting ongoing investment and operational scaling.