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I’m on vacation until September 7. I wrote this update on portfolio holding Cummins on August 22.
 
On August 1 Cummins (CMI) reported second quarter earnings of $2.53 a share. That was 3 cents a share below Wall Street estimates. Revenue climbed 12% year over year to $5.08 billion, significantly above the $4.8 billion projection.
 
For the full 2017 year, the company told Wall Street to expect revenue growth of 9% to 11% or $19.08 billion to $19,43 billion vs the $18.52 billion Wall Street estimate. The company had earlier forecast revenue growth of 4% to 7%.
 
I really don’t have any worries about Cummins in the near term. In the longer term, however, the company faces an incredibly difficult transition from a world of truck engines built around internal combustion technologies (gasoline and diesel) to world of hybrids and electric engines. Add in the coming transition to driverless trucking and, well, things get even more complicated and unpredictable.
 
Cummins has shown that it can push ahead with natural gas engine technologies and long-term investors should remember that they own Cummins because the company is so good at investing in research and development. The company recently announced plans to start production of electric power trains for city buses in 2019 and seems to be positioning itself for the day when the market moves away from diesel trucks.
 
Cummins is a member of my long-term 50 Stocks portfolio. The shares are up 38.43% since I added them to this portfolio on May 3, 2013.