Cummins Inc. saw solid growth in revenue and earnings in the second quarter, the Indiana-based engine manufacturer announced Tuesday morning.
The company missed Wall Street expectations with its bottom line, but raised its outlook for the full-year.
Profit rose 4.4 percent, to $424 million, or $2.53 per share, compared with $406 million, or $240 per share, in the second quarter of 2016.
Those results did not meet the average estimate of nine analysts surveyed by Zacks Investment Research, who predicted earnings of $2.58 per share.
Revenue shot up 12 percent, to $5.1 billion, compared with $4.5 billion in the year-ago period, surpassing Wall Street forecasts. Seven analysts surveyed by Zacks expected revenue of $4.79 billion.
Cummins expects full year 2017 revenue to increase in the range of 9 percent to 11 percent, higher than the prior forecast of 4 percent to 7 percent. Earnings before interest and taxes, or EBIT, are expected to be in the range of 11.75 to 12.5 percent of sales, unchanged from prior guidance.
“We delivered strong revenue growth in all four operating segments in the second quarter due to improving conditions in a number of important markets where we also have leading share,” Cummins CEO Tom Linebarger said in written comments. “Earnings increased due to solid operational performance, partially offset by higher warranty costs that resulted in second quarter EBIT that was below our expectations.”
Linebarger cited “stronger-than-expected orders in truck and construction markets in North America and China, and improving demand from global mining customers” for the decision to raise the Columbus-based company’s outlook.
Cummins shares dropped 5 percent early Tuesday, to $159.38 per share. Entering the day, the shares had climbed 23 percent since the beginning of the year and 37 percent in the last 12 months.