Cummins Inc. (NYSE: CMI) shares are trading higher today after CNBC's Jim Cramer said Friday night on his television show the company has a clear technological advantage over the competition because its engines are designed to be more efficient than future emissions standards dictate. This could be good news for CMI in the long run. If you think that the stock won't fall by too much in the coming months, then now could be a good time to look at a bullish hedged trade on CMI.

After hitting a one-year high of $71.725 in October, the stock hit a one-year low of $38.11 in January. CMI opened this morning at $58.78. So far today the stock has hit a low of $57.50 and a high of $59.46. As of 1:15, CMI is trading at $58.58, up $2.52 (4.5%). The chart for CMI looks bullish and steady, while S&P gives the stock a bullish 4 Stars (out of 5) Buy rating.

For a bullish hedged play on this stock, I would consider a September bull-put credit spread below the $35 range. A bull-put credit spread is an options position that combines the purchase and sale of put options to hedge risk in case the stock doesn't do what you think but still leverage nice returns. For this particular trade, we will make a 4.2% return in just five months as long as CMI is above $35 at September expiration. Cummins would have to fall by more than 40% before we would start to lose money.

CMI hasn't been below $38 at all in the past year and has shown support around $47 recently. This trade could be risky if the company's earnings (due out Wednesday before the market opens) disappoint, but even if that happens, that position could be protected by support the stock might find just between $40 and $50, where it has bottomed over the past few months.

Brent Archer is an options analyst and writer at Investors Observer. At publication time, Brent neither owns nor controls positions in CMI.

The temperatures may still be mild in much of the country, but Mother Nature's not fooling the calendar... Thanksgiving is just a week from tomorrow. Then comes the holiday shopping season, and before you know it, we're in 2008.

It's been an interesting year for stocks so far, what with the private-equity bum rush that fizzled, a housing market that just won't snap back, and a little thing called "subprime." But nevertheless, both the Dow and the S&P have managed to hit new record highs. There have been plenty of bullish opportunities if you've been looking in the right places, and of course, there have been some absolute collapses as well.

Ahead of the Ides of November, I turned to the Quantitative Analysis group at Schaeffer's Investment Research, led by the fearless Joe Sunderman, for a list of the best, and worst, performers, year-to-date, in the S&P 500 Index. These rankings were pulled earlier today and do not include any dividend payouts.

Last December, over 100 stocks were featured in our Top Picks for 2007 report. Now, at mid-year, we turn to the 20 advisors whose picks showed the strongest gains to get an update on their previous picks, as well as a new favorite stock for the second half of the year.

Neil Macneale, editor of 2 for 1 (a newsletter focused exclusively on stocks that have announced stock splits), chose two stocks in the Top Picks for 2007 report, and both picks qualified him for our Top 20 Advisors. His previous selections were Chaparrel Steel Co. (NASDAQ: CHAP) and Steel Dynamics Inc. (NASDAQ: STLD).

As of June 1, 2007, Steel Dynamics has risen 49%. while Chapparel had scored a gain of 67%. Here is Neil's original recommendation for these issues.

Updating his outlook on these steel stock, he now says, "This rate of return cannot continue forever, but there is every reason to believe these remain good stocks to own.

"Steel should continue to perform, given the strength of the economy, even without a strong housing market. As the housing market improves, steel should get even stronger. In both cases, fundamentals for these companies remain strong and the stocks still sell at a discount to their peers."

MOST NOTEWORTHY: The truck industry, Roo Group (RGRP), Accuray (ARAY) and TomoTherapy (TTPY) were today's noteworthy initiations:

• In the trucking industry, FTN Midwest initiated shares of Cummins Inc (NYSE: CMI) and Navistar International Corp (NASDAQ: NAVZ) with Hold Ratings and Oshkosh Truck Corp (NYSE: OSK) and PACCAR Inc (NASDAQ: PCAR) with Buy ratings.
• ROO Group (NASDAQ: RGRP) was initiated with a Buy rating and a $3.75 target at Think Equity, which believes RGRP is positioned to capitalize as the Internet continues to grow as a broadcast medium for video.
• Soleil initiated shares of Accuray Inc. (NASDAQ: ARAY) with a Buy rating and $30 target. The company is Soleil's top pick in radiation oncology.
• Soleil also initiated shares of TomoTherapy Inc. (NASDAQ: TTPY) with a Buy rating and $25 target, as the firm believes all-in-one imaging and radiation oncology system in HiArt could become the new standard of care.

OTHER INITIATIONS:

• Elan Corp (NYSE: ELN) was initiated with an Outperform rating and $40 target at Leerink Swann, which added shares to the firm's Focus List as it is positive on the Tysabri opportunity.
• Cree Inc (NASDAQ: CREE) was initiated with a Buy rating and $50 target at Amtech, as the firm believes the time for LED adoption has finally arrived and will accelerate in the future.
• Nollenberger initiated shares of ZipRealty (NASDAQ: ZIPR) and Move, Inc (NASDAQ: MOVE) with Neutral ratings.
• CIBC World Markets initiated shares of Whole Foods Market Inc. (NASDAQ: WFMI) with a Sector Underperformer rating and $38 target, expecting the company to be impacted by increasing competition.
• BMO Capital Markets initiated shares of Intel Corp. (NASDAQ: INTC) with an Outperform rating and $10 target.

Analyst summaries provided by TheFlyOnTheWall.com (subscription required).

While you've been busy scouring over this week's earnings reports, back here at rumor central there's been a number of "head ups," but not all that much to write home about, or to send you phoning your broker. But take note of these just for the heck of it.

UNITED RENTALS INC (NYSE: URI)

It's not news that the world's largest rental company has been for sale for a couple of weeks, but once again, as it is for so many speculative situations as this, there's an ongoing undercurrent of chatter. The CEO is retiring in June, and the COO will then hold down the fort. UBS (NYSE: UBS) and Credit Suisse (NYSE: CS) are offering advice. The company's in pretty good shape, and should attract some interesting offers. The stock keeps ticking slowly upward. But the rental market has slowed some. Stay tuned.

EASTMAN KODAK COMPANY (NYSE: EK)

The stock's been moving on up. Take over? Cash infusion? Fabulous new product release? Not one of us outsiders knows for sure what's up. So, what is up? Well, they sold the health imaging business and should get paid its $2.35B soon. Is Hewlett-Packard (NYSE: HPQ) a potential merger partner? Maybe, maybe not. Last month it was reported that Kodak had eyes for OmniVision Technologies (NASDAQ: OVTI). Maybe after quarterly results are released May 4 there'll be a clearer Kodak moment. Just don't count on them to try and rejoin the Better Business Bureau anytime soon. Now there's a rumor.

CUMMINS INC (NYSE: CMI)

Shares hit a record high the other day, at least one brokerage firm upgraded the stock, and reports were that the engine maker was...you guessed it...the target of takeover "expectations." Is that like, expecting? Like expecting to be courted and bought? Fiat (NYSE: FIA) could be expecting cause they are among the "rumored" to want to expand their truck division in good old North America. Cummins, one of the few remaining independents worldwide, meanwhile has been humming along, with three straight years of record earnings. What a machine, eh? Hmmm.

On tonight's MAD MONEY on CNBC, Jim Cramer was at Indiana University in another one of his "Back to School" tours. Cramer noted that the bears may be in hibernation because of a Fear in selling stocks because any of the bottom 350 S&P 500 Index stocks are vulnerable to being acquired. They are also scared to miss rate cuts and they don't have the Iranian hostage scare. That is why we were up the last two days. Mark Cuban came on the show tonight.

Cramer's stock pick to look at is Cummins Inc. (NYSE: CMI), the truck engine maker that Cramer says is a Triple Buy. At $145 per share it isn't cheap, but Cramer thinks this one is going up. Those that follow the stock are not behind the company. Cramer said he thought it was a dog too, but he said its business in emissions controls and power generators makes it more attractive. Many have shorted the company and that didn't work because they changed manufacturing changes that are paying off and they are selling very well in Mexico and everywhere else. It has 5 sells, 5 holds, and 1 Buy rating from Wall Street; Cramer thinks it will get upgraded when they keep beating the street estimates.