The latest 13F reporting period has come and gone, and Insider Monkey is again at the forefront when it comes to making use of this gold mine of data. We have processed the filings of the more than 867 world-class investment firms that we track and now have access to the collective wisdom contained in these filings, which are based on their September 30th holdings, data that is available nowhere else. Should you consider The AZEK Company Inc. (NYSE:AZEK) for your portfolio? We’ll look to this invaluable collective wisdom for the answer.
The AZEK Company Inc. (NYSE:AZEK) has experienced an increase in hedge fund sentiment of late. The AZEK Company Inc. (NYSE:AZEK) was in 38 hedge funds’ portfolios at the end of the third quarter of 2021. The all time high for this statistic was previously 37. This means the bullish number of hedge fund positions in this stock currently sits at its all time high. Our calculations also showed that AZEK isn’t among the 30 most popular stocks among hedge funds (click for Q3 rankings).
At Insider Monkey, we scour multiple sources to uncover the next great investment idea. For example, lithium prices have more than doubled over the past year, so we go through lists like the 10 best EV stocks to pick the next Tesla that will deliver a 10x return. Even though we recommend positions in only a tiny fraction of the companies we analyze, we check out as many stocks as we can. With all of this in mind let’s check out the latest hedge fund action surrounding The AZEK Company Inc. (NYSE:AZEK).
Clint Carlson of Carlson Capital
Do Hedge Funds Think AZEK Is A Good Stock To Buy Now?
Heading into the fourth quarter of 2021, a total of 38 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 3% from one quarter earlier. The graph below displays the number of hedge funds with bullish position in AZEK over the last 25 quarters. With hedge funds’ sentiment swirling, there exists a few notable hedge fund managers who were upping their stakes considerably (or already accumulated large positions).
More specifically, Zimmer Partners was the largest shareholder of The AZEK Company Inc. (NYSE:AZEK), with a stake worth $95.9 million reported as of the end of September. Trailing Zimmer Partners was Millennium Management, which amassed a stake valued at $66 million. Balyasny Asset Management, Interval Partners, and Scopus Asset Management were also very fond of the stock, becoming one of the largest hedge fund holders of the company. In terms of the portfolio weights assigned to each position Stormborn Capital Management allocated the biggest weight to The AZEK Company Inc. (NYSE:AZEK), around 2.93% of its 13F portfolio. Appian Way Asset Management is also relatively very bullish on the stock, earmarking 2.44 percent of its 13F equity portfolio to AZEK.
Now, specific money managers have been driving this bullishness. Adage Capital Management, managed by Phill Gross and Robert Atchinson, initiated the largest position in The AZEK Company Inc. (NYSE:AZEK). Adage Capital Management had $14.2 million invested in the company at the end of the quarter. Michael Cowley’s Sandbar Asset Management also made a $7.6 million investment in the stock during the quarter. The other funds with brand new AZEK positions are Clint Carlson’s Carlson Capital, Andrew Byington’s Appian Way Asset Management, and Gregg Moskowitz’s Interval Partners.
Let’s check out hedge fund activity in other stocks similar to The AZEK Company Inc. (NYSE:AZEK). We will take a look at Watts Water Technologies Inc (NYSE:WTS), Range Resources Corp. (NYSE:RRC), Clean Harbors Inc (NYSE:CLH), Fate Therapeutics Inc (NASDAQ:FATE), Valvoline Inc. (NYSE:VVV), Harley-Davidson, Inc. (NYSE:HOG), and Southwestern Energy Company (NYSE:SWN). This group of stocks’ market values match AZEK’s market value.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| WTS | 16 | 515456 | -2 |
| RRC | 25 | 527031 | 0 |
| CLH | 24 | 391049 | 0 |
| FATE | 36 | 2103428 | -4 |
| VVV | 23 | 641833 | -3 |
| HOG | 33 | 956467 | -4 |
| SWN | 22 | 263603 | -5 |
| Average | 25.6 | 771267 | -2.6 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 25.6 hedge funds with bullish positions and the average amount invested in these stocks was $771 million. That figure was $427 million in AZEK’s case. Fate Therapeutics Inc (NASDAQ:FATE) is the most popular stock in this table. On the other hand Watts Water Technologies Inc (NYSE:WTS) is the least popular one with only 16 bullish hedge fund positions. Compared to these stocks The AZEK Company Inc. (NYSE:AZEK) is more popular among hedge funds. Our overall hedge fund sentiment score for AZEK is 86. Stocks with higher number of hedge fund positions relative to other stocks as well as relative to their historical range receive a higher sentiment score. Our calculations showed that top 5 most popular stocks among hedge funds returned 95.8% in 2019 and 2020, and outperformed the S&P 500 ETF (SPY) by 40 percentage points. These stocks returned 28.6% in 2021 through November 30th but still managed to beat the market by 5.6 percentage points. Hedge funds were also right about betting on AZEK as the stock returned 7.4% since the end of September (through 11/30) and outperformed the market by an even larger margin. Hedge funds were clearly right about piling into this stock relative to other stocks with similar market capitalizations.
Follow Azek Co Inc. (NYSE:AZEK)
Follow Azek Co Inc. (NYSE:AZEK)
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Disclosure: None. This article was originally published at Insider Monkey.
