Tue, Oct. 6, 12:58 PM
- Westport Innovations (WPRT +6%) says the new ISL G Near Zero NOx natural gas engine, created through its joint venture with Cummins (CMI +0.9%), has become the first MidRange engine in North America to receive emission certifications from both the U.S. EPA and California's Air Resources Board to meet Near Zero NOx Emissions standards for medium-duty truck, urban bus, school bus and refuse applications.
- The venture says exhaust emissions will be 90% lower than the current EPA NOx limit of 0.2 g/bhp-hr and meets 2017 EPA greenhouse gas emission requirements.
Thu, Oct. 1, 11:57 AM
- Truck maker stocks trade at a wider discount to the S&P 500 on a key valuation measure, according to analysis from Bloomberg Intelligence.
- The group's 12-month P-E ratio of 9.122 is a 40% discount to the S&P 500 blended mark of 15.117. The gap was 28% in June.
- Bloomberg notes the group typically trades at a discount to the S&P 500 due to seasonal cycles.
- Related stocks: CMI, NAV, OSK, OTCPK:VOLVY, PCAR, OTCPK:DDAIF.
Mon, Sep. 28, 11:48 AM
- Cummins (CMI -2.8%) is downgraded to Hold from Buy at BB&T Capital, which believes the best case scenario for CMI is for 2016 earnings to come in flattish, and would not be surprised to see a Y/Y decline next year due to a decelerating North America truck cycle, continued headwinds in industrial markets, and CMI's international exposure (~37% of revenue).
- The firm thinks Q3 2015 may be respectable, but its 2016 estimate goes to $10.35 vs. the $10.77 consensus, and firm's 2017 estimate goes to $10.45 vs. the $11.83 consensus.
- While CMI has an upcoming analyst day on Nov. 10, the firm considers it unlikely that CMI will announce a major buyback and expects a more bearish tone when the company reports Oct. 27 given that select markets have decelerated materially.
Fri, Sep. 25, 11:20 AM
- Barclays analyst Robert Wertheimer begins coverage of the U.S. machinery sector with a negative view, seeing consensus estimates too high across the board with revenue for the current cycle already peaking for most of the sector.
- The analyst expects a sharper than expected downturn for North American trucks, with another peak level eight years away; the tractor supercycle is only two years in a downturn, while the prior two supercycles saw seven consecutive down years in machinery sales, Wertheimer says.
- Of the 15 companies in the firm's sector coverage universe, only two are rated Overweight: United Rentals (URI +1.5%) and Allison Transmission (ALSN +0.4%).
- Started with Equal Weight ratings: Actuant (ATU -1.2%), AGCO (AGCO +1%), Caterpillar (CAT -1%), Joy Global (JOY -2.9%), Lincoln Electric (LECO -0.8%), Manitowoc (MTW -1.9%), Terex (TEX -0.7%) and WABCO (WBC -1.2%).
- Rated Underweight: Deere (DE -0.3%), CNH Industrial (CNHI +1.5%), Cummins (CMI -0.8%), PACCAR (PCAR -1%) and Navistar (NAV -2.9%).
Thu, Sep. 24, 11:22 AM
- Caterpillar's (CAT -6.3%) latest woes are wreaking havoc on other machinery stocks, including Deere (DE -3.4%), Joy Global (JOY -2.4%), Cummins (CMI -2.8%) and Terex (TEX -5.6%).
- CAT said today it is lowering its sales outlook for the year and will cut as many as 5K jobs between now and the end of 2016, and that sales and revenue could drop in 2016 for a record fourth straight year.
- Earlier this week, CAT gave its latest update on three-month rolling sales figures, which have now declined for 33 straight months.
Tue, Sep. 22, 12:19 PM
- Cummins (CMI -2.4%) and Allison Transmission (ALSN -4.6%) are downgraded to Hold from Buy at Deutsche Bank, which says 2016 estimates for the two companies are too optimistic and do not fully discount potential headwinds.
- Deutsche Bank analysts say Off-Highway estimates need to be revised down to reflect the lower commodity price environment, and that the North America On-Highway cycle may have peaked, which is not reflected in Wall Street estimates.
- The firm cuts its price target for CMI to $123 from $154 and for ALSN to $28 from $38.
Tue, Jul. 28, 10:10 AM
- Trucking stocks are broadly higher in early trading with manufacturers and suppliers both participating in the mini-rally.
- Positive Class 8 truck sales data and a strong report from PACCAR are helping to boost confidence.
- Gainers: PACCAR (NASDAQ:PCAR) +1.39%, Navistar (NYSE:NAV) +1.51%, Daimler (OTCPK:DDAIF) +1.31%, Cummins (NYSE:CMI) +3.19%, Volkswagen (OTCQX:VLKAY) +2.06%, Wabash National (NYSE:WNC) +1.40%, Oshkosh (NYSE:OSK) +1.32%.
Tue, Jul. 28, 8:10 AM
- Net income grew 6% to $471M, or $2.62 per diluted share vs. $446M, or $2.43 per diluted share in the second quarter of 2014.
- Revenue by segment: Engine +2%; Distribution +21%; Components +9%; Power Generation +1%.
- Returned $517M to shareholders in the form of dividends and share repurchases during the quarter.
- The company still expects full year 2015 revenues to grow between 2%-4%, and EBIT in the range of 13.5%-14% of sales.
- Q2 results
- CMI +4.3% premarket
Tue, Jul. 28, 7:32 AM
Mon, Jul. 27, 5:30 PM
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Thu, Jul. 23, 7:35 PM
- Caterpillar (NYSE:CAT) fell 3.5% in today's trade after cutting revenue guidance for the year during its Q2 earnings report while noting a "relatively stagnant" global economy.
- With sales running at ~25% below the level of three years ago, analysts in today's earnings call asked CEO Doug Oberhelman if he thought deeper cost cuts are needed; while the CEO promised to slash spending if the global economy gets much worse, he said CAT wants to retain enough capacity so it can be ready to take advantage of an eventual recovery.
- Oberhelman tries to see the bright side of things: Companies continue to reduce spending on equipment, maintenance and even spare parts, so CAT's mining "trucks and ancillary equipment are being used longer and longer and longer," meaning the miners will have to buy new trucks at some point.
- Sales will heavily depend on what happens to the global economy, but CFO Brad Halverson says if CAT's forecast of lower H2 sales proves accurate, it would be the first time since the 1930s the company has suffered three straight years of decline.
- Wells Fargo keeps its Market Perform rating on CAT while saying the demand trends indicated by the company may have a negative implications for Cummins (NYSE:CMI), Terex (NYSE:TEX) and Deere (NYSE:DE).
Tue, Jun. 30, 11:07 AM
- After nearly thirty years with the Company, Cummins (CMI +0.5%) Chief Technical Officer John Wall has decided to retire.
- Under Wall's leadership, diesel engine emissions technology advanced significantly at the company, evolving into a key competitive advantage for Cummins.
- Jennifer Rumsey, Vice President of Engineering for Cummins' Engine Business, will take his place.
Fri, Jun. 19, 11:26 AM
- The EPA and NHTSA have published a new set of rules covering fuel efficiency on medium and heavy duty vehicles built for the model year 2018 and beyond.
- The agencies forecast the program will cut greenhouse gas emissions by 1B metric tons and lower fuel costs by $170B for the lifetime of the vehicles manufactured under the program.
- Though the release of tighter emission rules has been widely anticipated, perhaps a bigger surprise this week was the strong statement made by Pope Francis on the global need to address climate control.
- The number of companies that could ultimately be impacted by the proposed changes if they are enacted spread across various sectors.
- Joint EPA/NHTSA proposal (.pdf)
- Encyclical letter from Pope Francis (.pdf)
- Related stocks: KNX, PTSI, ODFL, JBHT, R, SWFT, CNW, GM, F, OTCPK:DDAIF, NAV, OTCPK:VOLVY, CMI, PCAR, FDX, UPS, HTZ, TM,
Fri, Jun. 19, 10:09 AM
- The EPA is expected to announce a new set of rules today covering medium and heavy trucks built in the model year 2019.
- The administration aims to improve fuel efficiency with larger-sized trucks accounting for 20% of all emissions in the transportation sector off a mark of 4% of vehicles on the road.
- The new rules could also cover light-duty pickup trucks, buses, and delivery vehicles.
- Related stocks: KNX, PTSI, ODFL, JBHT, R, SWFT, CNW, GM, F, OTCPK:DDAIF, NAV, OTCPK:VOLVY, CMI, PCAR.
Mon, May 18, 3:03 PM
- Goldman's sees the S&P 500 hitting a mid-year high of 2,150 by mid-year, but fading to 2,100 by year-end after the Fed hikes rates. Its 12-month forecast of 2,125 stands against the current level of 2,130.
- With appreciation returns expected to be nil, Goldman suggests having a look at its dividend growth portfolio - a sector-neutral basket of 50 stocks. They have a median yield of 2.5% and are expected to boost payouts by 16% this year and 12% in 2016. The group's P-E ratio is 15 vs. 17.3 for the S&P 500.
- The ten highest-yielding additions: Harley-Davidson (NYSE:HOG) - with a 2.3% yield, Home Depot (NYSE:HD) - 2.1%, Dr. Pepper Snapple (NYSE:DPS) - 2.5%, National Oilwell Varco (NYSE:NOV) - 3.6%, Regions Financial (NYSE:RF) - 2.3%, Baxter International (NYSE:BAX) - 3.1%, Cummins (NYSE:CMI) - 2.4%, Seagate Technology (NASDAQ:STX) - 3.9%, International Paper (NYSE:IP) - 3.1%, AES Corp (NYSE:AES) - 3%.
- Looking over a ten-year horizon, Goldman expects dividends to account for 46% of the S&P 500's 5% annualized return, up from 20% during the current bull market which started in 2009.
- ETFs: DVY, SCHD, ADX, SDOG, DLN, DHS, FDL, DTD, FVD, DVYL, SDYL
Tue, May 12, 3:19 PM
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