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New Dividend: 50 cents quarterly (per share)

Dividend Percent Increase: 25%

Current Yield: 2.39%

Engine maker Cummins ( CMI) designs and builds the diesel and natural gas truck engines found in everything from higher-end Dodge Rams models to the big rigs on the highway.

The firm's dividend engine is also cranking this week. On Tuesday, management announced a 25% increase to the firm's quarterly payout, bringing it to 50 cents per share. That's a 2.39% yield at current price levels.

>>6 Dividend Stocks With Strong Payout Ratios

Cummins is an integrated engine supplier, building everything from turbochargers to the power units and filtration systems used on its engines in-house. That positioning gives CMI better control over its manufacturing process and over costs. The double-digit net margins the firm earned in the last year are a testament to that.

Of course, the dividend hike in Cummins wasn't a complete surprise; the firm was one of the 5 Industrial Stocks Poised for Bigger Dividends that I talked about at the start of June.

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