NEW YORK (TheStreet) --The Trans-Pacific Partnership (TPP) is proposed legislation that aims to promote international trade by significantly reducing tariffs to foster economic growth.
The TPP, which has yet to be ratified, brings together 12 countries and is designed to put America in the driver's seat regarding international trade. American businesses will be able to export more goods and thus support further job growth, according to President Obama. The countries included are the U.S., Japan, Malaysia, Vietnam, Singapore, Brunei, Australia, New Zealand, Canada, Mexico, Chile, and Peru.
Critics of the partnership say that its primary purpose is to keep China from making further strides in writing the rules of international trade. Others have said that the TPP invites extensive changes without voters' consent.
"TPP is a modern and comprehensive trade agreement and it's really for a modern era and economy like the U.S. It would definitely be good for Cummins (CMI) - Get Report and for the U.S. business, workers, and farmers," Cummins CEO Thomas Linebarger said during this morning's "Squawk Box" on CNBC.
Linebarger, an advocate for the TPP, noted that it is an agreement which addresses several concerns.
"It's got new chapters that deal with e-commerce for modern technology businesses. It's got sectors for small business, sectors for labor and environmental standards. It's even got stronger investor settlement dispute language. It's really good for all sectors of the economy and addresses all the concerns of political parties have raised," he explained.
Additionally, Linebarger noted that globalization will take place whether the U.S. trades or not. However, when the country does not trade globally, it falls behind.
"The view of businesses I talked to, large and small, is trade agreements like this can help U.S. businesses, make sure we have a level playing field so as globalization occurs we can win," he said.
Shares of Cummins were higher in mid-morning trading on Monday.
Separately, TheStreet Ratings objectively rated this stock according to its "risk-adjusted" total return prospect over a 12-month investment horizon. Not based on the news in any given day, the rating may differ from Jim Cramer's view or that of this articles's author.
TheStreet Ratings rated this stock as a "buy" with a ratings score of B.
The company's strengths can be seen in multiple areas, such as its largely solid financial position with reasonable debt levels by most measures, attractive valuation levels, good cash flow from operations, increase in stock price during the past year and notable return on equity. We feel its strengths outweigh the fact that the company has had sub par growth in net income.
You can view the full analysis from the report here: CMI