Hedge Funds Are Crazy About Pinnacle West Capital Corporation (PNW)

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As industrywide interest jumped, key money managers have been driving this bullishness. Zimmer Partners, led by Stuart J. Zimmer, created the most valuable position in Pinnacle West Capital Corporation (NYSE:PNW). Zimmer Partners had $5.7 million invested in the company at the end of the quarter. Matthew Hulsizer’s PEAK6 Capital Management also initiated a $1 million position during the quarter. The following funds were also among the new PNW investors: George Hall’s Clinton Group, David Costen Haley’s HBK Investments, and Ken Griffin’s Citadel Investment Group.

Let’s check out hedge fund activity in other stocks – not necessarily in the same industry as Pinnacle West Capital Corporation (NYSE:PNW) but similarly valued. These stocks are Tesoro Corporation (NYSE:TSO), Expeditors International of Washington (NASDAQ:EXPD), Albemarle Corporation (NYSE:ALB), and Fortune Brands Home & Security Inc (NYSE:FBHS). This group of stocks’ market valuations are closest to PNW’s market valuation.

Ticker No of HFs with positions Total Value of HF Positions (x1000) Change in HF Position
TSO 41 1671737 3
EXPD 21 582053 1
ALB 38 882632 -2
FBHS 25 332101 1

As you can see these stocks had an average of 31 hedge funds with bullish positions and the average amount invested in these stocks was $867 million. That figure was $669 million in PNW’s case. Tesoro Corporation (NYSE:TSO) is the most popular stock in this table. On the other hand Expeditors International of Washington (NASDAQ:EXPD) is the least popular one with only 21 bullish hedge fund positions. Compared to these stocks Pinnacle West Capital Corporation (NYSE:PNW) is even less popular than EXPD. Considering that hedge funds aren’t fond of this stock in relation to other companies analyzed in this article, it may be a good idea to analyze it in detail and understand why the smart money isn’t behind this stock. This isn’t necessarily bad news. Although it is possible that hedge funds may think the stock is overpriced and view the stock as a short candidate, they may not be very familiar with the bullish thesis. In either case more research is warranted.

Disclosure: None

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