4-Star Stocks Poised to Pop: Cummins

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Based on the aggregated intelligence of 180,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, diesel engine manufacturer Cummins (NYS: CMI) has earned a respected four-star ranking.

With that in mind, let's take a closer look at Cummins' business and see what CAPS investors are saying about the stock right now.

Cummins facts

Headquarters (Founded)Columbus, Ind. (1919)
Market Cap$17.9 billion
IndustryConstruction and farm machinery and heavy trucks
Trailing-12-MonthRevenue$16.04 billion
ManagementChairman/CEO Tim Solso
President/COO N. Thomas Linebarger
Return on Equity (Average, Past 3 Years)21.6%
Cash/Debt$1.47 billion / $761 million
Dividend Yield1.8%
CompetitorsCaterpillar (NYS: CAT)
Navistar International (NYS: NAV)

Sources: Capital IQ (a division of Standard & Poor's) and Motley Fool CAPS.

On CAPS, 96% of the 1,326 members who have rated Cummins believe the stock will outperform the S&P 500 going forward. These bulls include NHWeston and Blackarrow1969.

This past summer, NHWeston touched on the tailwinds working in Cummins' favor: "They make engines, a whole range of types, including nat gas power. At the first signs of either global recovery or serious municipal interest in gas-powered vehicles, they'll head for [$120 per share]."

Cummins even boasts a solid debt-to-capital ratio of 12%. That's much lower than that of other heavy-equipment stocks like Caterpillar (71%), Navistar (86%), and Deere (NYS: DE) (78%).

CAPS member Blackarrow1969 elaborates on the Cummins bull case:

Trucking fleets are aging rapidly, and will need replacement trucks. Fleets in the United States are older than they have been in many years, possibly as old as they have ever been. Own some of this stock so you can benefit when all those engines for the replacement trucks need to be manufactured.

What do you think about Cummins, or any other stock for that matter? If you want to retire rich, you need to put together the best portfolio you can. Owning exceptional stocks is a surefire way to secure your financial future, and on Motley Fool CAPS, thousands of investors are working every day to find them. CAPS is 100% free, so get started!

Interested in another easy way to trackCummins?Add it to your watchlist.

At the time this article was published Fool contributor Brian Pacampara owns no position in any of the companies mentioned. Motley Fool newsletter services have recommended buying shares of Cummins. Try any of our Foolish newsletter services free for 30 days.We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Fool's disclosure policy always gets a perfect score.

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