CMI vs CMO Which Is More Reliable?

CMI (Cummins Inc.) and CMO (Capstead Mortgage Corporation) are two distinct companies operating in different industries. CMI is a global leader in power generation systems and related services, while CMO primarily focuses on investing in residential mortgage securities. Both stocks have their own unique investment potential and risk factors. This comparison explores the differences between the two companies in terms of their financial performance, market share, and strategic direction to help investors make informed decisions.

CMI or CMO?

When comparing CMI and CMO, different investors may prioritize various metrics based on their investment strategies and goals. So, ask yourself what type of investor you are. This will guide you in determining which metrics are most important for your investment decision between CMI and CMO.

Dividend Investors:

Dividend investors look for stable and growing income streams, using dividend metrics to assess potential investments. A company's dividend yield essentially measures the size of its dividend relative to the total market value of the company. CMI has a dividend yield of -%, while CMO has a dividend yield of -%. Beyond the yield itself, considering the growth and sustainability of these dividends is also crucial. CMI reports a 5-year dividend growth of 0.00% year and a payout ratio of 0.00%. On the other hand, CMO reports a 5-year dividend growth of 0.00% year and a payout ratio of -19.66%.

Value Investors:

Value investors focus on financial metrics to determine a stock's intrinsic value compared to its market value. The Price-to-Earnings (P/E) Ratio links stock price to a company's earnings per share, with CMI P/E ratio at -0.85 and CMO's P/E ratio at -11.03. Another crucial valuation metric is the Price-to-Book (P/B) Ratio, which compares stock price with book value per share. CMI P/B ratio is -0.05 while CMO's P/B ratio is 1.04.

Growth Investors:

Growth investors prioritize metrics indicative of a company's expansion potential. Focusing on top-line growth, CMI has seen a 5-year revenue growth of -0.96%, while CMO's is -0.38%. Return on Equity (ROE) measures how effectively a company uses equity investment to generate earnings, with CMI's ROE at 6.33% and CMO's ROE at -9.66%.

Retail Investors:

Retail investors often consider stock affordability and company familiarity. For example, day low prices are ₹4.41 for CMI and ฿0.78 for CMO. Over the past year, CMI's prices ranged from ₹3.95 to ₹8.20, with a yearly change of 107.59%. CMO's prices fluctuated between ฿0.59 and ฿1.37, with a yearly change of 132.20%. Brand recognition also plays a role, as familiarity with a company can influence investment decisions.