Cummins: The Backup Power Story Is The Main Story

Summary Cummins is rated a Strong Buy, driven by a strategic pivot into prime power for data centers and robust Power Systems growth. CMI's data center power revenues are set to rise from $5B today to $9B by 2030, with pricing power and market share gains supporting guidance. Accelera, CMI’s zero-emissions segment, is narrowing losses and projected to deliver $1.45B in 2030 revenue, underpinning margin and EPS expansion. Forecasts call for $47.5B revenue, 20% EBITDA margin, and $49.16 EPS by 2030, implying a 46.5% EV upside at a conservative 12x multiple. anutr tosirikul/iStock via Getty Images Investment Thesis Cummins ( CMI ) started off in the backseat in the power market for data centers, or at least that is what it might seem like. The real winners so far have been companies like Caterpillar ( This article was written by Andres Veurink 2.56K Followers Follow With over a decade of institutional investment experience, I specialize in identifying growth opportunities at the intersection of technological disruption and macro-thematic energy shifts. I've spent the majority of that time at a hedge fund here in Rotterdam, working my way up as an analyst. My work reflects rigorous standards as I myself have a very high standard as to what I invest my money in. My primary coverage spans the technology sector—with a focus on SaaS and cloud infrastructure—and the energy and minerals markets. I tend to be very data and trend driven in my work, analyzing unit economics and supply chain gaps among a number of other often overlooked areas in business and industries.I find these offer incredible growth opportunities and are also very fun to research and follow. It's a very active space with plenty of news coming out each week. Work is my own thoughts and research is done only by myself. Analyst’s Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article. Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.