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Last up on this week's Rocket Stocks list is
Cummins(CMI - Get Report), the manufacturer of diesel, hybrid and natural gas engines, primarily for heavy trucks. Like our other Rocket names, CMI has enjoyed some stellar relative strength vs. the broad market year-to-date. That trend looks likely to continue from here.
Cummins is an integrated engine builder. That means that the firm is responsible for everything from the turbochargers to the power units and filtration systems used on its engines. Building more parts may take extra specialization to pull off, but it means that Cummins is able to earn bigger net margins by not shelling out profits to a supplier too.
Going green is a big trend in the commercial truck market, and Cummins owns a significant chunk of that. It's already the biggest builder of natural gas-powered engines in the world, offering operators efficiency that's all the more attractive while gas prices remain high.
Not all of Cummins' business is commercial; the firm also makes the turbo diesels found in Dodge Ram trucks. While the Cummins engine is a pricier option, it's one that around 80% of eligible Ram buyers opt for. That may sound trivial at first, but pickup truck engines now make up around 10% of CMI's total sales -- that's no joke.
Financially, the firm is in great shape, with a net cash position (a rarity for such a capital-intense industrial firm). A 1.7% dividend yield rounds out the story for this firm right now.
To see all of this week's Rocket Stocks in action, check out
the Rocket Stocks portfolio at Stockpickr.
-- Written by Jonas Elmerraji in Baltimore.