Cummins is a diesel engine manufacturer. Co.'s segments are: Engine, which manufactures and markets diesel and natural gas-powered engines; Distribution, which is Co.'s primary sales, service and support channel; Components, which supplies aftertreatment systems, turbochargers, transmissions, filtration products, electronics and fuel systems for commercial diesel and natural gas applications; Power Systems, which includes power generation, industrial, and generator technologies product lines; and New Power, which designs, manufactures, sells and supports hydrogen production solutions and electrified power systems ranging from fully electric to hybrid along with components and subsystems.
When researching a stock like Cummins, many investors are the most familiar with Fundamental Analysis — looking at a company's balance sheet, earnings, revenues, and what's happening in that company's underlying business. Investors who use Fundamental Analysis to identify good stocks to buy or sell can also benefit from CMI Technical Analysis to help find a good entry or exit point. Technical Analysis is blind to the fundamentals and looks only at the trading data for CMI stock — the real life supply and demand for the stock over time — and examines that data in different ways. One of those ways is to calculate a Simpe Moving Average ("SMA") by looking back a certain number of days. One of the most popular "longer look-backs" is the CMI 200 day moving average ("CMI 200 DMA"), while one of the most popular "shorter look-backs" is the CMI 50 day moving average ("CMI 50 DMA"). A chart showing both of these popular moving averages is shown on this page for Cummins. Comparing two moving averages against each other can be a useful visualization tool: by calculating the difference between the CMI 200 DMA and the CMI 50 DMA, we get a moving average convergence divergence indicator ("CMI MACD"). The CMI MACD chart, in conjunction with the chart of the moving averages, basically helps in visualizing how the moving averages are showing convergence (moving closer together), or divergence (moving farther apart). |
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Video: Technical Analysis