...Rating Strengths: Cummins, Inc.'s (CMI) ratings recently were affirmed based on the company's strong operating profile that includes competitive positions in its engine and power generation markets, technological capabilities and global distribution network. CMI's financial flexibility and low leverage mitigate concerns about its exposure to cyclical heavy- and medium-duty truck, off-road equipment and power generation markets. Low Leverage: CMI's debt totaled nearly $1.7 billion at June 29, 2014, and debt/EBITDA remained low at 0.7x. CMI's leverage would be lower when considering the effect of earnings from manufacturing and distributor joint ventures, which are excluded from Fitch Ratings' EBITDA calculation. Joint Ventures: Joint venture income from unconsolidated ventures primarily related to the engine and distribution segments is an important source of earnings for CMI and generates approximately 17% of segment profit. Distributor Acquisitions: In late 2013, CMI initiated a plan to...
