Melius Upgrades Cummins (NYSE:CMI) to "Buy"

Key Points

• Melius Research has upgraded Cummins from a "hold" rating to a "buy" rating with a target price of $500.00, indicating a potential upside of 26.71% from its current price.
• Other analysts have also shown optimism, with multiple upgrades resulting in an average price target of $380.77, while eight analysts rated it as a buy.
• Cummins reported earnings of $6.43 per share for the last quarter, exceeding expectations and demonstrating resilience despite a year-over-year revenue decline of 1.7%.

Melius upgraded shares of Cummins (NYSE:CMI - Free Report) from a hold rating to a buy rating in a research note published on Wednesday morning, Marketbeat.com reports. Melius currently has $500.00 price target on the stock.

A number of other equities research analysts have also recently commented on CMI. Citigroup upped their target price on shares of Cummins from $380.00 to $425.00 and gave the company a "buy" rating in a report on Wednesday, August 6th. Barclays upped their target price on shares of Cummins from $381.00 to $387.00 and gave the company an "equal weight" rating in a report on Monday, July 21st. Truist Financial upped their target price on shares of Cummins from $342.00 to $380.00 and gave the company a "hold" rating in a report on Thursday, August 7th. Evercore ISI reaffirmed an "outperform" rating on shares of Cummins in a report on Tuesday, August 19th. Finally, The Goldman Sachs Group raised shares of Cummins from a "neutral" rating to a "buy" rating and upped their target price for the company from $410.00 to $431.00 in a report on Tuesday, May 27th. Nine equities research analysts have rated the stock with a Buy rating, six have given a Hold rating and one has given a Sell rating to the company. Based on data from MarketBeat.com, Cummins currently has an average rating of "Moderate Buy" and a consensus target price of $389.29.

Cummins Stock Performance

Shares of CMI stock traded down $0.80 during mid-day trading on Wednesday, hitting $400.13. 864,159 shares of the stock were exchanged, compared to its average volume of 706,473. The stock's fifty day simple moving average is $370.88 and its two-hundred day simple moving average is $336.01. The stock has a market capitalization of $55.13 billion, a price-to-earnings ratio of 18.81, a P/E/G ratio of 1.93 and a beta of 1.02. Cummins has a 12-month low of $260.02 and a 12-month high of $408.38. The company has a debt-to-equity ratio of 0.53, a quick ratio of 1.03 and a current ratio of 1.64.

Cummins (NYSE:CMI - Get Free Report) last issued its quarterly earnings data on Tuesday, August 5th. The company reported $6.43 earnings per share (EPS) for the quarter, topping the consensus estimate 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%.The business's quarterly revenue was down 1.7% compared to the same quarter last year. During the same quarter last year, the company posted $5.26 earnings per share. On average, analysts forecast that Cummins will post 22.54 EPS for the current year.

Cummins Increases Dividend

The business also recently declared a quarterly dividend, which was paid on Thursday, September 4th. Stockholders of record on Friday, August 22nd were paid a dividend of $2.00 per share. This is a boost from Cummins's previous quarterly dividend of $1.82. The ex-dividend date of this dividend was Friday, August 22nd. This represents a $8.00 dividend on an annualized basis and a dividend yield of 2.0%. Cummins's dividend payout ratio is currently 37.61%.

Insider Buying and Selling at Cummins

In other news, VP Amy Rochelle Davis sold 5,002 shares of the business's stock in a transaction on 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 transaction, the vice president directly owned 20,738 shares of the company's stock, valued at $8,354,925.44. The trade was a 19.43% decrease in their ownership of the stock. The transaction was disclosed in a legal filing with the SEC, which is available through the SEC website. Also, Director Karen H. Quintos sold 1,307 shares of the stock in a transaction on Tuesday, August 19th. The shares were sold at an average price of $405.33, for a total value of $529,766.31. Following the sale, the director directly owned 5,227 shares in the company, valued at approximately $2,118,659.91. The trade was a 20.00% decrease in their position. The disclosure for this sale can be found here. Over the last ninety days, insiders have sold 26,039 shares of company stock worth $10,385,075. Insiders own 0.41% of the company's stock.

Institutional Trading of Cummins

Large investors have recently made changes to their positions in the stock. Fox Run Management L.L.C. acquired a new stake in shares of Cummins during the first quarter valued at $2,749,000. Alpha Cubed Investments LLC acquired a new position in Cummins in the first quarter valued at $440,000. Assenagon Asset Management S.A. increased its stake in Cummins by 8.9% in the first quarter. Assenagon Asset Management S.A. now owns 13,666 shares of the company's stock valued at $4,283,000 after purchasing an additional 1,114 shares during the last quarter. Invesco Ltd. increased its stake in Cummins by 11.6% in the first quarter. Invesco Ltd. now owns 1,215,956 shares of the company's stock valued at $381,129,000 after purchasing an additional 126,362 shares during the last quarter. Finally, Artemis Investment Management LLP increased its stake in Cummins by 19.1% in the first quarter. Artemis Investment Management LLP now owns 7,747 shares of the company's stock valued at $2,428,000 after purchasing an additional 1,241 shares during the last quarter. Institutional investors and hedge funds own 83.46% of the company's stock.

About Cummins

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.