In this article, we will look at the 5 best momentum stocks to invest in. If you want to explore similar stocks, you can read 12 Best Momentum Stocks To Invest In.
5. Hudson Technologies, Inc. (NASDAQ:HDSN)
YTD Return as of October 20: 79.75%
Number of Hedge Fund Holders: 14
Hudson Technologies, Inc. (NASDAQ:HDSN) provides solutions for commercial and industrial chiller plants and refrigeration systems. The stock is up 79.75% for the year, as of October 20, and is ranked high among the best momentum stocks to buy now. The company is cash-rich, profitable, and undervalued. Hudson Technologies, Inc. (NASDAQ:HDSN) has free cash flows of $38.74 million and a trailing twelve-month operating margin of 39.88%. As of October 20, Hudson Technologies, Inc. (NASDAQ:HDSN) is trading at a PE multiple of 4x.
Over the past three months, 2 Wall Street analysts have given Buy ratings on Hudson Technologies, Inc. (NASDAQ:HDSN). The stock has an average price target of $12, which implies a 55% upside from current levels.
At the close of Q2 2022, 14 hedge funds were eager on Hudson Technologies, Inc. (NASDAQ:HDSN) and held stakes worth $67 million in the company. This is compared to 14 positions in the previous quarter with stakes worth $45 million. As of June 30, Royce & Associates is the largest investor in Hudson Technologies, Inc. (NASDAQ:HDSN) and has stakes worth $12.59 million in the company.
Here is what Meridian Funds had to say about Hudson Technologies, Inc. (NASDAQ:HDSN) in its second-quarter 2022 investor letter:
“Hudson Technologies, Inc. (NASDAQ:HDSN) is the market leader in recycled and reclaimed refrigerants with proprietary reclamation technology and a national distribution network. We have owned shares of the company for several years due to our belief that its leading position would allow the company to capitalize on improving supply-demand dynamics from the Environmental Protection Agency’s (EPA’s) phaseout of R22 (refrigerant used in air conditioners). The phaseout concluded in 2020 and virgin R-22 is no longer being produced. This has resulted in strong refrigerant pricing given stable demand and more limited supply. As a result, overall fundamentals have accelerated which resulted in 150% revenue growth and 45% operating margins in its most recent quarter. We are optimistic that another catalyst for growth is the AIM Act to reduce the production of hydrofluorocarbons (HFCs). Similar to the phaseout of R-22, we believe this will result in strong supply-demand dynamics for reclaimed HFC refrigerants and allow Hudson to capitalize on its market-leading position. During the quarter, we maintained our position in the stock.”
