Kodai Capital Management LP Takes $20.05 Million Position in Cummins Inc. $CMI

Key Points

• Kodai Capital Management LP purchased 63,964 shares of Cummins Inc., valued at approximately $20 million, indicating growing institutional interest in the company.
• The company recently declared a quarterly dividend increase to $2.00, up from the previous $1.82, reflecting a stable financial position and a dividend yield of 2.0%.
• Cummins Inc. reported earnings of $6.43 per share for its last quarter, surpassing the consensus estimate by $1.22, despite a revenue decrease compared to the same period last year.

Kodai Capital Management LP purchased a new position in Cummins Inc. (NYSE:CMI - Free Report) during the first quarter, according to its most recent disclosure with the Securities and Exchange Commission (SEC). The fund purchased 63,964 shares of the company's stock, valued at approximately $20,049,000.

A number of other institutional investors have also recently added to or reduced their stakes in CMI. Brighton Jones LLC lifted its position in Cummins by 4.1% during the fourth quarter. Brighton Jones LLC now owns 2,112 shares of the company's stock worth $736,000 after buying an additional 83 shares in the last quarter. Comerica Bank lifted its position in Cummins by 1.7% during the fourth quarter. Comerica Bank now owns 33,689 shares of the company's stock worth $11,744,000 after buying an additional 566 shares in the last quarter. Rehmann Capital Advisory Group lifted its position in Cummins by 20.2% during the fourth quarter. Rehmann Capital Advisory Group now owns 3,136 shares of the company's stock worth $1,093,000 after buying an additional 528 shares in the last quarter. Freestone Grove Partners LP purchased a new position in Cummins during the fourth quarter worth approximately $26,431,000. Finally, Cypress Advisory Group LLC purchased a new position in Cummins during the fourth quarter worth approximately $3,057,000. Hedge funds and other institutional investors own 83.46% of the company's stock.

Insider Activity

In other news, Director Karen H. Quintos sold 1,307 shares of the company's stock in a transaction dated Tuesday, August 19th. The stock was sold at an average price of $405.33, for a total transaction of $529,766.31. Following the completion of the transaction, the director directly owned 5,227 shares of the company's stock, valued at approximately $2,118,659.91. This represents a 20.00% decrease in their position. The transaction was disclosed in a legal filing with the SEC, which can be accessed through this link. Also, CFO Mark Andrew Smith sold 6,500 shares of the company's stock in a transaction dated Wednesday, August 13th. The stock was sold at an average price of $405.00, for a total value of $2,632,500.00. Following the transaction, the chief financial officer directly owned 31,582 shares of the company's stock, valued at approximately $12,790,710. This represents a 17.07% decrease in their ownership of the stock. The disclosure for this sale can be found here. Insiders sold a total of 26,039 shares of company stock worth $10,385,075 over the last three months. Company insiders own 0.41% of the company's stock.

Cummins Stock Down 1.0%

CMI traded down $3.82 on Tuesday, hitting $394.62. 635,628 shares of the company were exchanged, compared to its average volume of 873,570. Cummins Inc. has a twelve month low of $260.02 and a twelve month high of $408.38. The company has a market cap of $54.37 billion, a price-to-earnings ratio of 18.55, a price-to-earnings-growth ratio of 1.93 and a beta of 1.02. The company has a current ratio of 1.64, a quick ratio of 1.03 and a debt-to-equity ratio of 0.53. The firm has a 50-day moving average price of $364.99 and a two-hundred day moving average price of $335.23.

Cummins (NYSE:CMI - Get Free Report) last released its earnings results on Tuesday, August 5th. The company reported $6.43 EPS for the quarter, topping the consensus estimate of $5.21 by $1.22. Cummins had a return on equity of 26.96% and a net margin of 8.72%.The firm had revenue of $8.64 billion during the quarter, compared to analysts' expectations of $8.45 billion. During the same period in the previous year, the firm posted $5.26 EPS. Cummins's revenue for the quarter was down 1.7% on a year-over-year basis. On average, equities analysts predict that Cummins Inc. will post 22.54 earnings per share for the current year.

Cummins Increases Dividend

The business also recently announced a quarterly dividend, which will be paid on Thursday, September 4th. Investors of record on Friday, August 22nd will be paid a dividend of $2.00 per share. This represents a $8.00 annualized dividend and a yield of 2.0%. The ex-dividend date of this dividend is Friday, August 22nd. This is a positive change from Cummins's previous quarterly dividend of $1.82. Cummins's payout ratio is presently 37.61%.

Wall Street Analyst Weigh In

A number of equities research analysts have commented on CMI shares. Wells Fargo & Company upgraded Cummins to an "overweight" rating in a research report on Monday, August 11th. Wolfe Research upgraded Cummins from a "hold" rating to an "outperform" rating in a research report on Monday, August 11th. The Goldman Sachs Group upgraded Cummins from a "neutral" rating to a "buy" rating and lifted their target price for the company from $410.00 to $431.00 in a research report on Tuesday, May 27th. Truist Financial lifted their target price on Cummins from $342.00 to $380.00 and gave the company a "hold" rating in a research report on Thursday, August 7th. Finally, Citigroup lifted their target price on Cummins from $380.00 to $425.00 and gave the company a "buy" rating in a research report on Wednesday, August 6th. Seven analysts have rated the stock with a Buy rating, six have assigned a Hold rating and one has given a Sell rating to the stock. According to data from MarketBeat.com, Cummins has a consensus rating of "Hold" and an average target price of $370.83.

Cummins Profile

Cummins Inc designs, manufactures, distributes, and services diesel and natural gas engines, electric and hybrid powertrains, and related components worldwide. It operates through five segments: Engine, Distribution, Components, Power Systems, and Accelera. The company offers diesel and natural gas-powered engines under the Cummins and other customer brands for the heavy and medium-duty truck, bus, recreational vehicle, light-duty automotive, construction, mining, marine, rail, oil and gas, defense, and agricultural markets; and offers parts and services, as well as remanufactured parts and engines.