IBJNews

Cummins shares slide on job cuts, lower forecast

Back to TopCommentsE-mailPrintBookmark and Share

Shares in Cummins Inc. fell to the lowest level in three months Wednesday after the Columbus-based engine maker lowered its forecasts for revenue and profit and said it expects to cut as many as 1,500 jobs by the end of the year.

Its stock was trading at about $88 at noon, down almost 3 percent from Tuesday's $90.84 close. Earlier, they dropped to $86.50, the biggest intraday decline since July 10. The shares had gained 3.2 percent this year through Tuesday.

Cummins on Tuesday cut its forecast for full-year revenue to about $17 billion from $18 billion and reduced expectations for earnings before interest and taxes to about 13.5 percent from a range of 14.25 percent to 14.75 percent. That doesn’t include the cost or benefits of the job cuts.

“In my view this is worse than feared,” said Kristine Kubacki, a St. Louis-based analyst at Avondale Partners LLC. “My sense is the Street thought there would be a guide down, but this is sizable.”

Cummins, which has about 8,000 employees in Indiana, produces engines for trucks and power-generation equipment. The company had second-quarter earnings of $2.45 a share, excluding gains from divestitures. That exceeded the average of 18 estimates compiled by Bloomberg of $2.27.

“We continued to see weak economic data in a number of regions during the third quarter, increasing the level of uncertainty regarding the direction of the global economy,” Chief Executive Officer Tom Linebarger said in a statement. “As a result of the heightened uncertainty, end customers are delaying capital expenditures in a number of markets, lowering demand for our products.”

Class 8 truck orders fell 35 percent in North America last month to 15,205, according to FTR Associates.

ADVERTISEMENT

  • Touche
    But its kind of hard for the working poor and most middle class families to do that these days. Some of us have health problems, had to pay for college ourselves and pay a tax rate higher than 14%.
  • @HOOSIERLIB
    Maybe this be a good "teaching moment" for Democrats. Always prepare for the worst. Keep at least 6 months of income in a liquid savings account, save save save, because it's your own responsibility to prepare for the worst and hope for the best.
    • Safety Net
      Hopefully, this doesn't ruin anyone's life or hurt's their family. That being said, this will provide a good "teaching moment" for Republicans, perhaps they will understand the need for a good social safety net and that executives care more about their bonuses, than they do about the lives employees. Unfortunately, their nominees for governor and President reflect the latter philosophy. People before profits!

      Post a comment to this story

      COMMENTS POLICY
      We reserve the right to remove any post that we feel is obscene, profane, vulgar, racist, sexually explicit, abusive, or hateful.
       
      You are legally responsible for what you post and your anonymity is not guaranteed.
       
      Posts that insult, defame, threaten, harass or abuse other readers or people mentioned in IBJ editorial content are also subject to removal. Please respect the privacy of individuals and refrain from posting personal information.
       
      No solicitations, spamming or advertisements are allowed. Readers may post links to other informational websites that are relevant to the topic at hand, but please do not link to objectionable material.
       
      We may remove messages that are unrelated to the topic, encourage illegal activity, use all capital letters or are unreadable.
       

      Messages that are flagged by readers as objectionable will be reviewed and may or may not be removed. Please do not flag a post simply because you disagree with it.

      Sponsored by
      ADVERTISEMENT

      facebook - twitter on Facebook & Twitter

      Follow on TwitterFollow IBJ on Facebook:
      Follow on TwitterFollow IBJ's Tweets on these topics:
       
      Subscribe to IBJ
      1. Good Day I am Mr (Victoria Wright) from United state of America, i stayed in NEW YORK, and i have a broke up business, until i found this company email who help me to gain a loan for business,, and now i want to used this short medium to congratulate the below company for the fast and safe money they loan to me without any form of collateral, i loan 500,000USD from the company to save my business and lots more, i saw their mail on the internet, everyone always give testimony for what they did, so i quickly contacted them and they all did everything for me without stress and my money was sent to my account just 3 days later, i was surprise and i feel so glad, now i have a standard business control agent who help me, now i will advice those who need urgent loan to contact him at the bellow email:zenithfirm12@gmail.com

      2. NOTICE:This is to inform the general public that Vampires are real. My name is James Franklyn.,am an agent of vampire,am here to introduce our new world trend to you,a world of vampire where life get easier,we have made so many persons vampires and have turned them rich,you will be assured long life and prosperity,you shall be made to be very sensitive to mental alertness,stronger and also very fast,you will not be restricted to walking at night only even at the very middle of broad day light you will be made to walk.In case you are wildly oppressed by some unscrupulous persons we can still help you fight them.Your protection is assured immediately you join.Just contact the bellow email if you are interested we are here to attend to you anytime you want us. Contact the bellow email for more details. Email:vampirescreed@hotmail.com Sincerely: James Franklyn.

      3. Bravo! Someone else that is willing to speak the truth! Bravo!_____NBCSN is available in almost 2 MILLION more homes than just a few years ago, but Indycar STILL gets less total viewers than it did just a few years ago when NBC took over Versus. Attendance and ratings cratered with the end of season races (just when the title battle got "interesting" HAH!__________And now...new race in Basilia, where Miles celebrated the "rich history" of Indycar racing there. Rich history? What, 7 events in the 100 years of AOW? Yep, some history. Well, at least its an oval. It's not??? Are you kidding me??? Gosh darn road racin furriners.

      4. PURITY RAY LOAN OFFER........ Have you been denied by your banks,or are you in need of of an urgent loan to pay of your bills we are capable of giving loans @ cheaper rate to interested individuals, student, companies and members of the public in need of finance to settle bills, we do offer considerable loans which you can count on. For more information on our various types of loan,then you will have to contact PURITY RAY LOAN FIRM, to help you achieve your desire LOAN APPLICATION FORM TO BE FILLED BORROWERS INFORMATION * Full name:………………………. * SEX * ……………………………. * Country………………………….. * State:……………………………. * Land:…………………………….. * Occupation:…………………….. * phone number:…………………. * Telephone: ………………………….. * Age:………………………………. * Amount needed as loan:……… * Loan Duration:………………….. * Propose of Loan:……………….. * Annual revenue:………………… * Monthly Income:……………….. * Guarantee:………………………. * Payment: monthly or annually Email.....purityrayloanfirm@gmail.com Thank you and God bless Mr Purity Ray PURITY RAY LOAN FIRM we tend to serve you better

      5. Problem: most of the people responding to this article don't know about this service AT ALL! Why? Lack of awareness. This isn't IndyGo. This is CIRTA: might as well be the mattress company because they are asleep at the wheel - something like 3 directors over the last year? Playing with federal grant money is great! This "region" wants commuter rail service, has spent MILLIONS on Transportation studies yet can't even support a commuter bus line? This is largely for suburban riders to get to downtown - not for "service people to work in our hotels and restaurants" ! Get your head out of your backside!! These are professionals, students etc. that don't want to fight traffic, save some money on parking, gas, stress.... if CIRTA would put their federal money into widely promoting the sevive to Greenwood, Fishers & Carmel instead of finding directors and studies - this would be a successful service. Our family uses(d) it daily for the last several years - but the recent uncertainty & now unreliability due to cuts from Carmel has been a problem. Now, costs us an additional $350/month for gas & parking ( $4200/year) plus vehicle wear, service, environmental impact ... YES - this REGION needs this this type of service in order to keep growing and getting the people it needs to fill skilled positions in downtown Indianapolis. Think outside of your own car !!!

      ADVERTISEMENT