Set the cylinder's flex values
Open the Flex dialog using the Window > Flex menu item (Command-B). Set the U and V sliders to 0.4. Sliders can be adjusted in one of three ways:

1. Click in either the up arrow or down arrow to move the slider up or down.
2. Click and drag in the slider itself.
3. Manually enter values into the fields (use tab to move through fields). To apply settings, hit the return or enter key. The cursor must be inside the dialog while typing.

Select a Vertex
Select the Reshape > Push/Pull tool. Click on the vertex indicated.

NOTE: there is no need to hold down the Command key, it is only needed when selecting a new object, not a new vertex. Note also that not all tools allow you to select vertices. The Move tool (by default) does not affect the object at a vertex level, so while the Move tool is the current tool, the software does'nt select vertices.