In this article, we discuss the 5 low profile stocks that surprised in 2021. If you want to read our detailed analysis of these stocks, go directly to the 10 Low Profile Stocks that Surprised in 2021.
5. Metropolitan Bank Holding Corp. (NYSE:MCB)
Number of Hedge Fund Holders: 23
Gain in Share Price in 2021: 196%
Metropolitan Bank Holding Corp. (NYSE:MCB) is a bank holding company based in New York. There is muted interest in the stock on mainstream financial news media despite the fact that the shares have jumped 177% in the past twelve months. The strong performance is driven by solid fundamentals and a healthy growth outlook. In the past two years, Metropolitan Bank Holding Corp. (NYSE:MCB) has consistently beaten market estimates on earnings and future prospects look bright amid growth of private business capitalization in the NY area.
There are some hedge funds that remain bullish on Metropolitan Bank Holding Corp. (NYSE:MCB) for 2022 as interest rates rise and equate to a direct increase in earnings. Among the hedge funds being tracked by Insider Monkey, Virginia-based firm EJF Capital is a leading shareholder in Metropolitan Bank Holding Corp. (NYSE:MCB) with 537,542 shares worth more than $45 million.
4. The AZEK Company Inc. (NYSE:AZEK)
Number of Hedge Fund Holders: 38
Gain in Share Price in 2021: 22%
The AZEK Company Inc. (NYSE:AZEK) makes and sells building products. On December 15, JPMorgan analyst Michael Rehaut upgraded The AZEK Company Inc. (NYSE:AZEK) stock to Overweight from Neutral and raised the price target to $56 from $54, noting that the share price of the firm did not reflect the long-term prospects of the stock. The analyst forecast that The AZEK Company Inc. (NYSE:AZEK) would deliver residential sales growth of 20% in 2022 and 12% in 2023, driven by factors such as material conversion and capacity expansion for growth.
The hedge fund sentiment around The AZEK Company Inc. (NYSE:AZEK) has been positive over the past few months as well. At the end of the third quarter of 2021, 38 hedge funds in the database of Insider Monkey held stakes worth $427 million in The AZEK Company Inc. (NYSE:AZEK), compared to 37 the preceding quarter worth $407 million.
In its Q2 2021 investor letter, Baron Funds, an asset management firm, highlighted a few stocks and The AZEK Company Inc. (NYSE:AZEK) was one of them. Here is what the fund said:
“The AZEK Company Inc.: AZEK is a leading manufacturer of outdoor, non-wood building products including decking, railing, trim, and other leading outdoor products. 95% of cash flow is generated from the U.S. residential housing market. We believe the company has a compelling multi-year strategic growth plan that should result in strong share price appreciation in the next few years.”
3. Macy’s, Inc. (NYSE:M)
Number of Hedge Fund Holders: 41
Gain in Share Price in 2021: 133%
Macy’s, Inc. (NYSE:M) owns and runs department stores. The company has beaten market estimates on earnings for the past six quarters and the shares have more than doubled in value over the past twelve months. However, Macy’s, Inc. (NYSE:M) remains one of the top value plays in the market as margins and free cash flows improve. Most of this growth is driven by online sales which is attracting new customers. In the third quarter of 2021, the firm attracted 4.4 million new customers to the brand.
Elite hedge funds have taken note of the performance and doubled down on their bullish bets on Macy’s, Inc. (NYSE:M). Among the hedge funds being tracked by Insider Monkey, Boston-based investment firm Arrowstreet Capital is a leading shareholder in Macy’s, Inc. (NYSE:M) with 10.5 million shares worth more than $238 million.
In its Q3 2021 investor letter, ClearBridge Investments, an asset management firm, highlighted a few stocks and Macy’s, Inc. (NYSE:M) was one of them. Here is what the fund said:
“Meanwhile, Macy’s, an omnichannel retail organization that operates stores, websites, and mobile applications under the Macy’s, Bloomingdale’s, and Bluemercury brands, also had a strong quarter (+21.5%). Macy’s delivered strong second-quarter earnings, beating on earnings and revenue and raising guidance as the retailer continues to pay down debt and grow its digital business.”
2. The Sherwin-Williams Company (NYSE:SHW)
Number of Hedge Fund Holders: 44
Gain in Share Price in 2021: 46%
The Sherwin-Williams Company (NYSE:SHW) markets specialty chemicals. Over the last decade, the company has managed to more than double annual revenues. The Sherwin-Williams Company (NYSE:SHW) has improved earnings by smart acquisitions, 14 in total over the past ten years, as well as organic growth. During this period, the margins for The Sherwin-Williams Company (NYSE:SHW) have also improved by almost 80%. In the coming years, the company expects sales to grow at around 8%.
The Sherwin-Williams Company (NYSE:SHW) has attracted the attention of hedge funds with its stellar performance. Among the hedge funds being tracked by Insider Monkey, Connecticut-based investment firm Chilton Investment Company is a leading shareholder in The Sherwin-Williams Company (NYSE:SHW) with 1.1 million shares worth more than $323 million.
1. Ford Motor Company (NYSE:F)
Number of Hedge Fund Holders: 51
Gain in Share Price in 2021: 143%
Although Ford Motor Company (NYSE:F) is a recognizable brand name, the stock has slipped under the radar with regards to the potential it offers in the EV market, considering the astronomical valuations of other EV firms with no legacy businesses. The company recently laid out a plan to double the production capacity for the Ford F150 Lightning, the all new electric pickup that surged in demand in the US and China since it was released last year. The truck had 200,000 pre-orders before it was even launched. Ford Motor Company (NYSE:F) also plans to increase EV battery capacity this year.
There are many hedge funds that hold bullish views on Ford Motor Company (NYSE:F). At the end of the third quarter of 2021, 51 hedge funds in the database of Insider Monkey held stakes worth $1.6 billion in Ford Motor Company (NYSE:F).
In its Q1 2020 investor letter, Greenlight Capital Fund, an asset management firm, highlighted a few stocks and Ford Motor Company (NYSE:F) was one of them. Here is what the fund said:
“General Motors (GM) was a disappointment. The damage from last year’s strike consumed most of the cash flow GM would have otherwise generated in 2019. We had expected a strong bounce back in earnings and cash flow in 2020, but the annual guidance, while meeting Wall Street expectations, was worse than we expected. Further, the cash burned during the strike needed to be re-earned in order to protect GM’s investment grade rating. Pre-crisis, there would have been, at best, a minimal share repurchase late in the year. At the analyst day, our hopes that 2020 would finally be the year were dashed. We sold our stock. Over our five-year holding period, we made a 9.6% IRR on GM. In the difficult environment, its most comparable peer, Ford, lost about half its value.”
You can also take a peek at 10 Stocks That Benefit from Global Chip Shortage and 10 Fintech Stocks Redditors are Buying.
