Cummins Inc. (NYSE: CMI) reported Q3 EPS of $2.32, $0.04 better than the analyst estimate of $2.28. Revenue for the quarter came in at $4.9 billion versus the consensus estimate of $4.72 billion.

"We delivered strong earnings and cash flow in the third quarter despite facing mixed conditions in international markets," said Chairman and CEO Tom Linebarger. "Earnings improved in all four of our businesses compared to a year ago. During the third quarter we increased the quarterly dividend by 25 percent and repurchased 1.2 million shares putting us well on track to return 50 percent of annual operating cash flow to shareholders. Although results in our Power Generation business improved in the third quarter, global demand for power generation equipment remains weak. As a result we are considering certain actions to reduce our cost structure starting in the fourth quarter. The cost of the actions being considered could range from $15 million to $40 million."

Based on the current forecast, Cummins expects full year 2014 revenues to grow between 10 percent and 12 percent, up from its previous forecast of growth of between 8 percent and 11 percent, due to stronger demand in North America. EBIT is expected to be in the range of 13 to 13.5 percent of sales, excluding the impact of cost reduction activities within the Power Generation business that will commence in the fourth quarter.

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