40 Most Popular Stocks Among Hedge Funds Heading Into 2026

39. Applied Materials (AMAT)

Number of Hedge Funds: 111 (2025Q4)

Number of Hedge Funds: 89 (2025Q3)

The surge in hedge fund interest in Applied Materials (AMAT) comes at a time when the company is being re-rated as a core “AI Infrastructure” play. Based on the latest data from Insider Monkey, here is a summary of why the “smart money” is piling into the stock as of late February 2026:

a. Massive Hedge Fund Accumulation

Hedge funds have aggressively increased their stakes, signaling high conviction in the semiconductor equipment sector’s growth.

• Citadel’s Massive Move: Ken Griffin’s Citadel Investment Group increased its position by a staggering 600% in the most recent filing period, holding over 2.4 million shares valued at approximately $636 million.
• Bullish Options Activity: Beyond common stock, major funds like Citadel are also holding significant Call options (valued at ~$503 million), indicating a bet on continued near-term price appreciation.

b. Strong Q1 2026 Earnings & Outlook

The stock’s momentum is supported by fundamental outperformance:

• Earnings Beat: AMAT was recently highlighted as one of the “12 Best Tech Stocks that Beat Earnings Estimates,” a key driver for institutional “buy” signals.
• Price Target Hikes: Following the Q1 2026 earnings call, analysts have been raising targets, with some reaching as high as $420 and maintaining “Overweight” ratings.
• The AI Tailwind: The company is seen as a primary winner in the Wafer Fab Equipment (WFE) market, benefiting from the global “AI Supercycle” and the transition to advanced nodes required for AI chips.

c. Insider Selling (Profit Taking)

While hedge funds are buying, corporate insiders have been active sellers in February 2026. This is often interpreted as tactical profit-taking following the stock’s recent rally rather than a lack of confidence in the business.

• Judy Bruner (Director): Sold shares multiple times in late February, totaling over $2.4 million at prices ranging from $376 to $391.
• Brice Hill (CFO): Sold 5,000 shares on February 17 for approximately $1.8 million.
• Adam Sanders (Controller): Sold shares for roughly $202,000 on February 24.

Summary Verdict

The “skyrocketing” number of hedge fund positions reflects a consensus among the world’s top money managers that AMAT is a critical “toll-booth” for the AI era. While insiders are trimming their personal holdings to lock in gains at record highs, the 600% increase from titans like Citadel suggests that the institutional “long” trade still has significant room to run.