Is Cummins Inc. (CMI) a Good Stock to Buy?

As industrywide interest jumped, some big names have been driving this bullishness. Lodge Hill Capital initiated the largest call position in Cummins Inc. (NYSE:CMI). Lodge Hill Capital had $44.9 million invested in the company at the end of the quarter and also created a $32 million long position in the stock during the quarter. The other funds with brand new CMI positions are Matthew Tewksbury’s Stevens Capital Management, and Louis Navellier’s Navellier & Associates.

Let’s check out hedge fund activity in other stocks similar to Cummins Inc. (NYSE:CMI). We will take a look at TELUS Corporation (USA) (NYSE:TU), Hess Corp. (NYSE:HES), EnergySolutions, Inc. (NYSE:ES), and Devon Energy Corp (NYSE:DVN). All of these stocks’ market caps match CMI’s market cap.

As you can see these stocks had an average of 29 hedge funds with bullish positions and the average amount invested in these stocks was $869 million. That figure was $510 million in CMI’s case. Devon Energy Corp (NYSE:DVN) is the most popular stock in this table. On the other hand TELUS Corporation (USA) (NYSE:TU) is the least popular one with only 9 bullish hedge fund positions. Cummins Inc. (NYSE:CMI) is not the least popular stock in this group but hedge fund interest is still below average. This is a slightly negative signal and we’d rather spend our time researching stocks that hedge funds are piling on. In this regard DVN might be a better candidate to consider a long position.

Disclosure: None