CMI vs DCI: Which Is the Better Buy in 2026?
Last updated August 2026
Short answer
CMI is the larger of the two ($87.51B market cap): the incumbent the market prices for continued execution (18.58x forward earnings, beta 1.22). DCI is the smaller challenger ($11.12B), actually pricier on forward earnings (21.88x): more room to run, but more to prove. The real question is which set of drivers you believe, and whether owning one (or both) leaves you over-concentrated.
CMI vs DCI: the tie-breaker metrics
Same yardstick, side by side (as of August 2026). Valuation lined up like this is most meaningful for two names in the same corner of the market, which these are. Figures are approximate; verify before investing.
| Metric | CMI | DCI | What it tells you |
|---|---|---|---|
| Market cap | $87.51B | $11.12B | Size. The larger name is the incumbent; the smaller has more room to grow and more to prove. |
| Forward P/E | 18.58 | 21.88 | Valuation on next year's expected earnings, the same yardstick for both. Lower is cheaper for that growth; higher means the market is paying up. |
| Trailing P/E | 32.89 | 25.86 | Valuation on the last 12 months. A big drop from trailing to forward means the market expects earnings to jump, so more growth is already in the price. |
| Beta | 1.22 | 0.93 | Volatility vs the market. Above 1 swings harder than the index; below 1 is steadier. Higher beta means bigger drawdowns to hold through. |
| Price vs 52-week range | 73% of range | 58% of range | Where today's price sits between the 52-week low and high. Near the high is momentum with less margin of safety; near the low is out of favor or a discount, depending on why. |
| Price / book | 7.09 | 6.56 | How much you pay over book value. Very high can signal an asset-light, high-return business or a rich price. |
Reading it: CMI is the cheaper of the two on forward earnings, but cheaper is not the same as better. Pair the valuation with growth (how far the forward P/E sits below the trailing P/E) and risk (beta) before you decide.
Before you buy: how CMI and DCI affect your concentration
The metrics above tell you which is the marginally better business. The bigger risk for most people is not picking the slightly worse stock, it is over-concentrating. CMI and DCI share themes, so owning both, or adding either to what you already hold, can quietly push a large share of your portfolio into one bet.
This is the part a generic comparison page cannot answer, because it depends on what you own. Connect your brokerage and Walnut shows your real, combined CMI and DCI exposure, flags overlap with your existing positions, and tells you if adding one would tip you past a concentration you are comfortable with, read-only by default, with your login staying at your broker. Walnut is not an investment adviser.
What does Cummins (CMI) do?
Cummins Inc. is one of the world's largest independent makers of diesel and natural gas engines, and it operates across five segments: Engine, Components, Distribution, Power Systems, and Accelera (its low-carbon and electrification arm). Its products power heavy- and medium-duty trucks, buses, construction and mining equipment, and standby and prime power generators, and it runs a large aftermarket parts and service network. The Distribution segment is the largest by revenue, while Power Systems has been the fastest-growing thanks to demand for backup power at data centers.
What does Donaldson Company (DCI) do?
Donaldson Company, Inc. (NYSE: DCI) makes filtration systems and, more importantly, the replacement filters that go into them. Three segments carry the business: Mobile Solutions, the largest at roughly ~62% of fiscal 2025 sales, covering air and liquid filters plus emissions systems for off-road machinery, trucks and the independent aftermarket; Industrial Solutions, covering dust collection, compressed air, gas turbine intake and, since May 2026, jet fuel filtration through the acquired Facet business; and Life Sciences, a smaller unit spanning food and beverage process filtration, disk-drive filters and an assembled bioprocessing portfolio built from Solaris, Purilogics, Isolere Bio and Univercells Technologies. Filters are consumable and often regulated, so a machine sold once generates parts revenue for a decade or more.
CMI vs DCI: how do they differ?
Both fit overlapping themes, but they are not interchangeable. The useful comparison is which set of drivers and risks you want exposure to.
- CMI drivers: Data center backup power; North American truck cycle.
- DCI drivers: Replacement filters as the recurring base; Facet and a heavier aerospace, defense and power tilt.
Which fits which kind of investor
A faster-growing, richer-valued name usually swings harder, so it suits a longer horizon and a higher tolerance for volatility; a steadier, more cash-generative business suits a more conservative or income-minded investor. The honest test is which set of risks you could hold through a drawdown: Cummins is exposed to the industrial and freight cycle, so a downturn in truck demand or construction spending can cut engine volumes and margins quickly. For DCI, mobile Solutions ties a majority of revenue to off-road and on-road equipment cycles, so agriculture, construction and truck build rates set the direction of first-fit volumes regardless of how steady the aftermarket is.
CMI or DCI: which should you pick?
Growth-minded investors who believe the theme has years to run tend to accept the richer multiple for more upside; value-minded investors lean toward the cheaper forward earnings and steadier profile. Pick CMI if you believe its drivers more; DCI if you believe its. Many investors hold both, but since they share themes, that is a concentrated bet, not diversification. Decide deliberately and check overlap. For the full detail, see the CMI and DCI guides.
CMI vs DCI: the full fundamentals
CMI. Cummins trades at a premium to its historical multiple after a large 2025-2026 run tied to data center power demand. The forward P/E near 23x sits well below the trailing figure, reflecting expected earnings growth as guidance was raised. The dividend is modest in yield but backed by a long record of annual increases.
DCI. Fiscal 2026 ends July 31, so the April quarter is the most recent reported period and fourth-quarter results are due August 26, 2026. GAAP EPS of ~$1.00 versus ~$0.48 a year earlier overstates the underlying improvement, because the prior-year quarter absorbed a ~$62.0 million impairment; adjusted EPS rose a more ordinary ~7.1% to ~$1.06. Nine-month operating cash flow of ~$293.8 million funded ~$104.0 million of dividends and ~$108.5 million of buybacks before repurchases were paused, with the quarterly dividend at ~$0.32 per share for a yield near ~1.3%.
Headline figures (approximate, JUNE 2026): CMI shows revenue (fy2025) ~$33.7B, revenue (q1 2026) ~$8.4B, up ~3% YoY, net income (fy2025) ~$2.8B, market cap ~$96B; DCI shows revenue (ttm) ~$3.81B (+4.4% YoY), q3 fy2026 sales (quarter ended apr 30, 2026) ~$995M (+5.8% YoY), a record, adjusted operating margin ~16.6% in Q3 FY2026, an all-time high, fy2026 adjusted eps guidance ~$3.94 to ~$4.01 (7% to 9% growth).
The bottom line: CMI vs DCI
CMI and DCI are related but distinct: same themes, different businesses and risks. Neither wins in the abstract; the right pick is whichever thesis you actually believe, sized so you are not over-concentrated in one theme. Walnut can show your combined CMI and DCI exposure against your real portfolio. It is not an investment adviser.
Wondering how CMI or DCI fits the portfolio you already own? Walnut is an AI investing app that connects your brokerage read-only and answers questions like that about your actual holdings: overlap, concentration, and how each position tracks the S&P 500. Compare the best AI portfolio analyzers or see the best AI investing apps in 2026.
Investing in Cummins with AI
Connect the broker you already use and ask Walnut's AI how CMI fits what you actually hold: whether you own it already through a fund, what it would do to your concentration, and how it has tracked the S&P 500. Read-only by default, and you approve anything before it reaches your broker.
FAQ
What is the difference between CMI and DCI?
+
Cummins Inc. Donaldson Company, Inc. They show up together because they share investment themes, but they are different businesses, so the better fit depends on which thesis you are expressing.
Is CMI or DCI the better stock?
+
Neither is universally better. CMI is the larger incumbent; DCI is the smaller challenger and looks pricier on forward earnings. Walnut is informational, not investment advice. Compare what each does, the tie-breaker metrics above, and the risks, then decide which fits your thesis and what you already own.
Which is cheaper, CMI or DCI?
+
On forward P/E (as of August 2026), CMI trades at 18.58x and DCI at 21.88x, so CMI is the cheaper of the two on next year's expected earnings. A lower multiple is not automatically the better buy: a richer valuation can be justified by faster growth, and a lower one can reflect real risk. Weigh the multiple against how fast each business is compounding.
Should you own both CMI and DCI?
+
Because they share themes, owning both concentrates you in that theme. That can be intentional (a focused bet) or accidental (less diversification than it looks). Walnut can show your combined exposure across both, and whether adding either over-concentrates you, before you buy.
What are the risks of CMI vs DCI?
+
CMI: Cummins is exposed to the industrial and freight cycle, so a downturn in truck demand or construction spending can cut engine volumes and margins quickly. The recent stock re-rating leaves valuation elevated versus history, which raises the bar for execution and makes the shares sensitive to any slowdown in data center power orders. Tightening or shifting emissions regulations can trigger costly product changes and demand pull-forwards or air pockets. Accelera continues to lose money and has produced restructuring charges, adding uncertainty. Tariffs, supply chain costs, and exposure to China and other international markets add further variability to results. DCI: Mobile Solutions ties a majority of revenue to off-road and on-road equipment cycles, so agriculture, construction and truck build rates set the direction of first-fit volumes regardless of how steady the aftermarket is. Industrial Solutions sales were roughly flat in the April quarter and management has previously trimmed guidance citing demand that softened after tariff-related pre-buying, and while Section 232 metal tariffs were characterized as not material, pricing is carrying a little over 1% of growth, which can reverse. The Facet purchase took pro forma net debt to about ~1.8x EBITDA, adds roughly ~$9 million of quarterly interest expense, and has paused share repurchases while the debt is paid down, so integration slippage would show up in both earnings and the buyback. Fiscal 2025 included a ~$62.0 million intangible-asset impairment tied to earlier acquisitions, a reminder that the bolt-on strategy in bioprocessing has already produced one write-down, and Life Sciences still earns roughly half the company margin. No active securities-fraud class action is on file against Donaldson; a 2015 revenue-recognition matter in a European gas turbine business and the investor suit that followed it are historical, and the valuation near ~26x trailing earnings leaves limited cushion if any of the above lands at once.
Related comparisons
Browse all stock comparisons.
Walnut is informational, not investment advice. This page is descriptive and not a recommendation to buy or sell CMI or DCI; figures are approximate and dated (as of August 2026). Verify current data before investing.