Applied Industrial Technologies (AIT): Are Hedge Funds Right About This Stock?

Due to the fact that Applied Industrial Technologies (NYSE:AIT) has gone through a decline in interest from hedge fund managers, logic holds that there exists a select few hedgies that elected to cut their entire stakes by the end of the third quarter. Interestingly, Neil Chriss’ Hutchin Hill Capital cashed in the biggest position of the “upper crust” of funds monitored by Insider Monkey, comprising an estimated $0.9 million in stock. Matthew Tewksbury’s fund, Stevens Capital Management, also dumped its stock, about $0.9 million worth.

Let’s go over hedge fund activity in other stocks similar to Applied Industrial Technologies (NYSE:AIT). We will take a look at Kennametal Inc. (NYSE:KMT), Anixter International Inc. (NYSE:AXE), M/A-COM Technology Solutions Holdings (NASDAQ:MTSI), and Triumph Group Inc (NYSE:TGI). All of these stocks’ market caps are similar to AIT’s market cap.

As you can see these stocks had an average of 19 hedge funds with bullish positions and the average amount invested in these stocks was $303 million. That figure was $71 million in AIT’s case. Kennametal Inc. (NYSE:KMT) is the most popular stock in this table. On the other hand M/A-COM Technology Solutions Holdings (NASDAQ:MTSI) is the least popular one with only 15 bullish hedge fund positions. Compared to these stocks Applied Industrial Technologies (NYSE:AIT) is only as popular as MTSI. 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