Cummins (NYSE:CMI) Reaches New 52-Week High - Here's Why

Key Points

• Cummins Inc. (NYSE:CMI) shares reached a new 52-week high at $432.94, closing at $432.27 with a trading volume of 482,180 shares.
• Citigroup raised its price target for Cummins from $425 to $485, maintaining a "buy" rating, while the stock has a consensus rating of "Moderate Buy" among analysts.
• The company recently announced a quarterly dividend of $2.00, an increase from $1.82, representing an annualized yield of 1.8% and a payout ratio of 37.61%.

Cummins Inc. (NYSE:CMI - Get Free Report) shares hit a new 52-week high on Thursday . The stock traded as high as $432.94 and last traded at $432.27, with a volume of 482180 shares traded. The stock had previously closed at $424.65.

Wall Street Analysts Forecast Growth

CMI has been the subject of a number of analyst reports. Citigroup increased their target price on shares of Cummins from $425.00 to $485.00 and gave the company a "buy" rating in a research report on Tuesday, September 23rd. Wolfe Research upgraded shares of Cummins from a "hold" rating to an "outperform" rating in a research report on Monday, August 11th. Robert W. Baird raised their price target on shares of Cummins from $315.00 to $355.00 and gave the stock a "neutral" rating in a research note on Friday, July 11th. Barclays boosted their price target on shares of Cummins from $381.00 to $387.00 and gave the company an "equal weight" rating in a research note on Monday, July 21st. Finally, Evercore ISI reiterated an "outperform" rating on shares of Cummins in a report on Tuesday, August 19th. Nine investment analysts have rated the stock with a Buy rating, six have assigned a Hold rating and one has given a Sell rating to the company. Based on data from MarketBeat.com, the stock has a consensus rating of "Moderate Buy" and an average price target of $393.57.

Cummins Stock Performance

The company has a quick ratio of 1.03, a current ratio of 1.64 and a debt-to-equity ratio of 0.53. The firm has a market cap of $59.64 billion, a P/E ratio of 20.35, a PEG ratio of 2.04 and a beta of 1.04. The firm has a fifty day moving average of $398.13 and a 200-day moving average of $344.32.

Cummins (NYSE:CMI - Get Free Report) last released its quarterly earnings results on Tuesday, August 5th. The company reported $6.43 EPS for the quarter, topping analysts' consensus estimates of $5.21 by $1.22. The company had revenue of $8.64 billion for the quarter, compared to analyst estimates of $8.45 billion. Cummins had a return on equity of 26.96% and a net margin of 8.72%.Cummins's revenue was down 1.7% compared to the same quarter last year. During the same quarter last year, the firm posted $5.26 earnings per share. Research analysts predict that Cummins Inc. will post 22.54 earnings per share for the current fiscal year.

Cummins Increases Dividend

The company also recently announced a quarterly dividend, which was paid on Thursday, September 4th. Shareholders of record on Friday, August 22nd were issued a $2.00 dividend. This represents a $8.00 dividend on an annualized basis and a yield of 1.8%. The ex-dividend date of this dividend was Friday, August 22nd. This is a boost from Cummins's previous quarterly dividend of $1.82. Cummins's payout ratio is currently 37.61%.

Insider Buying and Selling

In other news, VP Amy Rochelle Davis sold 5,002 shares of the stock in a transaction dated Thursday, August 14th. The stock was sold at an average price of $402.88, for a total value of $2,015,205.76. Following the completion of the sale, the vice president owned 20,738 shares of the company's stock, valued at approximately $8,354,925.44. This represents a 19.43% decrease in their ownership of the stock. The sale was disclosed in a filing with the SEC, which is accessible through the SEC website. Also, VP Luther E. Peters sold 4,850 shares of the firm's stock in a transaction that occurred on Friday, August 8th. The shares were sold at an average price of $389.19, for a total value of $1,887,571.50. Following the completion of the sale, the vice president directly owned 7,693 shares of the company's stock, valued at $2,994,038.67. This trade represents a 38.67% decrease in their position. The disclosure for this sale can be found here. In the last quarter, insiders have sold 35,119 shares of company stock valued at $14,159,885. Corporate insiders own 0.41% of the company's stock.

Institutional Investors Weigh In On Cummins

Several hedge funds have recently added to or reduced their stakes in CMI. Norges Bank bought a new stake in Cummins during the second quarter valued at about $505,941,000. Raymond James Financial Inc. grew its position in Cummins by 152.3% in the first quarter. Raymond James Financial Inc. now owns 1,354,052 shares of the company's stock worth $424,414,000 after acquiring an additional 817,384 shares in the last quarter. American Century Companies Inc. grew its position in Cummins by 138.8% in the second quarter. American Century Companies Inc. now owns 909,653 shares of the company's stock worth $297,912,000 after acquiring an additional 528,689 shares in the last quarter. Ontario Teachers Pension Plan Board boosted its position in shares of Cummins by 5,158.9% during the second quarter. Ontario Teachers Pension Plan Board now owns 435,960 shares of the company's stock valued at $142,777,000 after buying an additional 427,670 shares during the period. Finally, AQR Capital Management LLC boosted its position in shares of Cummins by 70.9% during the first quarter. AQR Capital Management LLC now owns 1,022,373 shares of the company's stock valued at $314,942,000 after buying an additional 424,294 shares during the period. Institutional investors own 83.46% of the company's stock.

Cummins Company Profile

Cummins Inc designs, manufactures, distributes, and services diesel and natural gas engines, electric and hybrid powertrains, and related components worldwide. It operates through five segments: Engine, Distribution, Components, Power Systems, and Accelera. The company offers diesel and natural gas-powered engines under the Cummins and other customer brands for the heavy and medium-duty truck, bus, recreational vehicle, light-duty automotive, construction, mining, marine, rail, oil and gas, defense, and agricultural markets; and offers parts and services, as well as remanufactured parts and engines.

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