Will Cummins Continue to Motor Higher?

December 30, 2012

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E = Equity to Debt Ratio Is Strong

The debt-to-equity ratio for Cummins is excellent. The balance sheet is also impressive. Cummins is stronger than Gardner Denver Inc. (NYSE:GDI) and SPX Corporation (NYSE:SPW) in both areas.

	Debt-To-Equity	Cash	Long-Term Debt
CMI	.12	$1.27 Billion	$747.00 Million
GDI	.32	$248.93 Million	$331.76 Million
SPW	.93	$346.30 Million	$2.15 Billion

T = Technicals on the Stock Chart Are Strong

Cummins has performed extremely well over the past three years. Even the past year has shown healthy returns. Also keep in mind that Cummins has a higher yield than Gardner Denver Inc. Cummins has a yield of 1.90 percent, SPX Corporation has a yield of 1.50 percent, and Gardner Denver Inc. has a yield of .30 percent.

	1 Month	Year-To-Date	1 Year	3 Year
CMI	9.96%	24.89%	24.71%	141.00%
GDI	-1.26%	-12.26%	-12.92%	58.35%
SPW	-1.40%	10.76%	10.19%	22.80%

At $108.07, Cummins is currently trading above all its averages.

50-Day SMA	98.58
100-Day SMA	97.95
200-Day SMA	101.02

E = Earnings and Revenue Have Been Impressive

Earnings and revenue have been improving since 2009.

	2007	2008	2009	2010	2011
Revenue ($)in billions	13.05	14.34	10.80	13.23	18.05
Diluted EPS ($)	3.70	3.85	2.16	5.28	9.55

When we look at last quarter on a YoY basis, we see a decrease in revenue and earnings. However, Cummins has bounced back strong since then.

	9/2011	12/2011	3/2012	6/2012	9/2012
Revenue ($)in billions	4.63	4.92	4.47	4.45	4.12
Diluted EPS ($)	2.35	2.85	2.38	2.47	1.86

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