Three Reasons to Sell Cummins Inc. (CMI) Stock

There are two threats stemming from Cummins’ significant investment in low-emissions technology. The first could be that different regulatory agencies don’t put in place or enforce new environmental standards. The second is that the standards could start to deviate significantly – with the EPA requiring one thing, and the EU something entirely different. That would cause Cummins to spend even more of its resources on tailoring the engines, instead of ramping up production to a level of scale.

What’s a Fool to do?
As it stands right now, I’m definitely holding my shares. Emerging markets may be a drag on Cummins stock for a while, but I have a decades-long timeline. While losing PACCAR Inc (NASDAQ:PCAR) would be a heavy hit, the two companies have been doing business for 68 years, and I don’t see any news to make me think that relationship is coming to an end. And while I can’t foresee how environmental regulations will play out, I’m confident with Cummins’ market position in that respect.

The article 3 Reasons to Sell Cummins Stock originally appeared on Fool.com is written by Brian Stoffel.

Fool contributor Brian Stoffel owns shares of Cummins and Westport Innovations. The Motley Fool recommends Cummins, Paccar, and Westport Innovations. The Motley Fool owns shares of Cummins, Paccar, and Westport Innovations.

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