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Cummins (CMI) Initiates Testing of Hydrogen Engine, Ups Dividend

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Cummins Inc. (CMI - Free Report) recently commenced testing a hydrogen-fueled internal combustion engine (ICE). The proof-of-concept test will help boost Cummins’ existing technology dominance in gaseous-fuel applications and powertrain. Moreover, it will create a solution that will help customers meet the future environmental requirements.

Cummins is highly optimistic about the potential of the hydrogen engine to reduce carbon emissions, while providing power and performance at the same time.

With the heightening climate-change concerns, the face of the auto industry is rapidly transforming. Investors are now intrigued with companies that offer green solutions to their transportation needs by ensuring zero carbon emissions. This is contributing to development of both battery-enabled and hydrogen-fueled vehicles that might be widely available in recent times.

With the potential for fast refueling, hydrogen is a promising medium for fueling zero-emission long-haul transportation applications and can be used to power fuel cells or ICEs.

Compared to fuel cell technology, hydrogen engines offer OEMs and end-users the benefit of adaptability by using the existing base engine technology to promote green transportation.

Amid this changing scenario, Cummins has distinct hydrogen capabilities spanning from fuel production to storage and vehicle power. It is rapidly fortifying its capabilities to provide hydrogen technologies at scale, which is crucial to the world’s green energy transition through the hydrogen economy. Moreover, Cummins is playing a pivotal role in advancing hydrogen ecosphere including hydrogen engines, fuel cells, electrolyzers and storage tanks, and has deployed more than 600 electrolyzers across 100 countries.

Cummins’ joint-venture partnership with hydrogen storage specialist NPROXX, a leading supplier of containerized storage vessels, has enhanced the company’s ability to merge the fuel cell or hydrogen engine with the high-pressure gas cylinder tanks and supply lines on the vehicle.

The hydrogen engines being tested use green hydrogen fuel produced by Cummins’ electrolyzers, emitting almost nil carbon emissions through the tailpipe. Once the proof-of-concept testing is completed, the company plans to test the engine in a variety of on- and off-highway applications.

The latest testing by Cummins, peers of which include Navistar International , Daimler AG and PACCAR Inc. (PCAR - Free Report) , underscores the company’s long-term vision to become a leader in hydrogen technology in a bid to achieve carbon neutrality by 2050. As the world transitions to a low-carbon future, the truck-engine giant has the financial stability to invest heavily in these technologies and further elevate its dominant position in shaping tomorrow’s hydrogen economy.

Meanwhile, Cummins’ management recently approved a quarterly cash dividend of $1.45 per share, marking an increase of 7% from the previous $1.35 per share. The dividend is payable on Sep 2, to shareholders as on Aug 20, 2021.

The latest dividend announcement implies the 12th consecutive year of dividend increase for Cummins, outlining the company’s consistent practice of returning wealth to shareholders while ploughing back some profits for the future.

Cummins currently carries a Zacks Rank of 2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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