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CMI
Benzinga
84 days

Goldman Turns Bullish On Cummins Amid Profit Shift And Quiet Data Center Play

1. Goldman Sachs upgraded CMI from Neutral to Buy rating. 2. Power Systems margins expanded from 5%-10% to 15%-20% due to value pricing. 3. $1.5 billion in sales from data center expected by Cummins' Power Systems segment. 4. Data center investments projected to grow significantly by 2030. 5. Used inventory levels of sleeper trucks down 30% year over year.

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FAQ

Why Bullish?

The upgrade and profit margin expansion suggest positive future performance. Historical examples like Tesla's margin improvements show how upgrades can lead to price increases.

How important is it?

The accumulation of data center sales forecasts and margin expansions directly influences CMI’s profitability.

Why Long Term?

The projected growth in the data center sector and pricing changes indicate sustained growth. Similar to increased construction investments in renewable energy seen previously, long-term benefits can be anticipated.

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