Why This Cummins Analyst Is Downshifting On The Stock
Portfolio Pulse from Priya Nigam
BofA Securities analyst Michael Feniger downgraded Cummins Inc. (NYSE:CMI) from Neutral to Underperform and lowered the price target from $243 to $225. Despite a strong balance sheet and market leadership, consensus earnings expectations for Cummins are considered high, especially with an anticipated decline in North American truck production in 2024. Cummins is also facing uncertainties in its hydrogen business amidst heavy investments to comply with a rising regulatory environment. Cummins shares fell by 2.12% to $228.12 following the downgrade.
January 19, 2024 | 5:34 pm
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Cummins Inc. was downgraded by BofA Securities from Neutral to Underperform with a price target reduction from $243 to $225, due to high earnings expectations and potential decline in truck production in 2024.
The downgrade by a major analyst like BofA Securities typically has a negative impact on the stock price in the short term, as it may lead to a reassessment of the stock's value by the market. The reduction in the price target and concerns over future earnings and production challenges are likely to be viewed negatively by investors.
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