Cummins Posts Modest 0.06 Gain as $250M Volume Ranks 400th Amid India Power Surge and 39 Undervaluation Estimate

Cummins Inc. (CMI) closed August 19, 2025, with a 0.06% gain, trading at a daily volume of $250 million, ranking 400th in market activity. The stock’s modest movement reflected mixed signals from earnings reports and valuation assessments. A recent intrinsic value analysis suggested shares were 39% undervalued, with a fair price estimate of $635, while analysts highlighted robust performance in power systems and distribution segments.

Second-quarter results underscored strength in demand for power generation systems, particularly in India, where consolidated profits surged 26% year-over-year to $69.05 million. The firm’s global power generation business benefited from heightened electricity consumption during summer months and AI-driven data center investments. Despite a 2% year-over-year revenue decline in the U.S., the company exceeded earnings and revenue estimates, driven by margin improvements in key divisions.

Insiders have maintained a cautiously optimistic stance, with executives emphasizing secular growth in power systems and dividend sustainability. The board recently increased the quarterly dividend to $2.00 per share, reflecting confidence in cash flow stability. However, lingering concerns over North American market weakness and potential tariff impacts weighed on broader sentiment, even as short interest in CMI shares declined by 5.32% in recent weeks.

The strategy of buying the top 500 stocks by daily trading volume and holding them for one day resulted in a moderate return. The total profit from December 2022 to August 2025 was $2,940, with a maximum drawdown of $-1,960 during the same period. This indicates a volatile but ultimately positive performance, with the highest peak-to-trough decline being 19.6%.