Drilling Down Into Cummins Inc. (CMI)

Cummins Inc. (CMI) is an interesting player in the Industrial Goods space, with a focus on Diversified Machinery. The stock has been active on the tape, currently trading at $161.70, up from yesterday’s close by 1.39%. Given the stock’s recent action, it seemed like a good time to take a closer look at the company’s recent data.

Fundamental Analysis

Money managers are always interested in a company that can find the right recipe of fundamental data because it reflects something important going on underneath the surface. Cummins Inc. (CMI) currently trades with a market capitalization of $26.80 Billion. That value represents a market adjusting for revenues that have been growing by 6.94 % on a quarterly year/year basis as of the company’s last quarterly report.

The balance sheet health of any company plays a key role in its ability to meet its obligations and maintain the faith of its investment base. For CMI, the company currently has $1.32 Billion of cash on the books, which is offset by $369 Million current liabilities. You can get a sense of how sustainable that is by a levered free cash flow of $1.51 Billion over the past twelve months. Generally speaking, earnings are expected to fall in coming quarters. Analysts are forecasting earnings of $2.53 on a per share basis this quarter. Perhaps, that suggests something about why 62.12% of the outstanding share supply is held by institutional investors.

Technical Analysis

It’s important to check the technicals to get a sense of how CMI has been acting. Looking at the stock’s movement on the chart, Cummins Inc. recorded a 52-week high of $163.36. It is now trading 1.66% off that level. The stock is trading $154.20 its 50-day moving average by -7.5%. The stock carved out a 52-week low down at $105.33.

In recent action, Cummins Inc. (CMI) has made a move of +5.47% over the past month, which has come on weak relative transaction volume. Over the trailing year, the stock is outperforming the S&P 500 by 25.22, and it’s gotten there by action that has been more volatile on a day-to-day basis than most other stocks on the exchange. In terms of the mechanics underlying that movement, traders will want to note that the stock is trading on a float of 2.39% with $165.76 Million sitting short, betting on future declines. That suggests something of the likelihood of a short squeeze in shares of CMI.

Previous articleEdison International (EIX): From Top to Bottom
Next articleThe Case for and Against Ralph Lauren Corporation (RL)