Wolfe upgrades Cummins to Outperform on higher margins, earnings

Wolfe Research analyst Scott Group upgraded Cummins (CMI) to Outperform from Peer Perform with a $480 price target following the Q2 report. The company is seeing structurally higher margins and earnings despite the continued weak Class 8 truck market, the analyst tells investors in a research note. The firm believes that with growing data center exposure and leverage to an eventual truck upcycle, Cummins is “very well positioned right now.” Wolfe thinks the company’s higher margins and earnings will support a higher valuation.