It's turning out to be a rough year for Cummins (CMI -0.12%) investors. The stock hit a new 52-week low last week, after losing as much as 12% since the engine maker reported its third-quarter numbers in late October.
A trifecta of bad news hit Cummins shares: weak Q3 numbers, a disappointing outlook, and restructuring announcements that point to tougher times ahead. Just weeks before Cummins reported, Caterpillar (CAT 0.07%) had warned of a slowdown when it slashed its outlook and forward guidance. But investors perhaps weren't expecting Cummins to take as big a hit, given Caterpillar's greater exposure to vulnerable end markets such as mining and energy.
However, Cummins' third-quarter report revealed several concerns that are hard to ignore. That explains why analysts are cautious, with Morgan Stanley even rating Cummins stock a sell with a price target of $79, representing roughly a 20% downside from the current price, as of this writing.
While it's difficult to predict a price point, the following slideshow highlights the three biggest hurdles that could hurt Cummins' growth prospects going forward. Take a look.
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Cummins Stock Hits 52-Week Lows: Could it Slip Below $80? from The Motley Fool.
