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Here is What Hedge Funds Think About Fastenal Company (FAST)

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The Insider Monkey team has completed processing the quarterly 13F filings for the September quarter submitted by the hedge funds and other money managers included in our extensive database. Most hedge fund investors experienced strong gains on the back of a strong market performance, which certainly propelled them to adjust their equity holdings so as to maintain the desired risk profile. As a result, the relevancy of these public filings and their content is indisputable, as they may reveal numerous high-potential stocks. The following article will discuss the smart money sentiment towards Fastenal Company (NASDAQ:FAST).

Is Fastenal Company (NASDAQ:FAST) the right pick for your portfolio? The best stock pickers were turning bullish. The number of bullish hedge fund bets improved by 5 in recent months. Fastenal Company (NASDAQ:FAST) was in 30 hedge funds' portfolios at the end of September. The all time high for this statistic is 38. Our calculations also showed that FAST 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 we're going to analyze the fresh hedge fund action surrounding Fastenal Company (NASDAQ:FAST).

David E. Shaw of D.E. Shaw
David E. Shaw of D.E. Shaw

David E. Shaw of D.E. Shaw

Do Hedge Funds Think FAST Is A Good Stock To Buy Now?

Heading into the fourth quarter of 2021, a total of 30 of the hedge funds tracked by Insider Monkey were long this stock, a change of 20% from the second quarter of 2021. On the other hand, there were a total of 38 hedge funds with a bullish position in FAST a year ago. So, let's find out which hedge funds were among the top holders of the stock and which hedge funds were making big moves.

The largest stake in Fastenal Company (NASDAQ:FAST) was held by Cantillon Capital Management, which reported holding $295.6 million worth of stock at the end of September. It was followed by Select Equity Group with a $76.8 million position. Other investors bullish on the company included D E Shaw, AQR Capital Management, and Marshall Wace LLP. In terms of the portfolio weights assigned to each position Unio Capital allocated the biggest weight to Fastenal Company (NASDAQ:FAST), around 3.97% of its 13F portfolio. Cantillon Capital Management is also relatively very bullish on the stock, dishing out 2.02 percent of its 13F equity portfolio to FAST.

Now, specific money managers were breaking ground themselves. Marshall Wace LLP, managed by Paul Marshall and Ian Wace, assembled the largest position in Fastenal Company (NASDAQ:FAST). Marshall Wace LLP had $24.7 million invested in the company at the end of the quarter. Phill Gross and Robert Atchinson's Adage Capital Management also initiated a $13.1 million position during the quarter. The other funds with new positions in the stock are Qing Li's Sciencast Management, Dan Rasmussen's Verdad Advisers, and Jinghua Yan's TwinBeech Capital.

Let's go over hedge fund activity in other stocks - not necessarily in the same industry as Fastenal Company (NASDAQ:FAST) but similarly valued. These stocks are ArcelorMittal (NYSE:MT), Ecopetrol S.A. (NYSE:EC), Ball Corporation (NYSE:BLL), Lennar Corporation (NYSE:LEN), Fifth Third Bancorp (NASDAQ:FITB), Alexandria Real Estate Equities Inc (NYSE:ARE), and MPLX LP (NYSE:MPLX). This group of stocks' market valuations match FAST's market valuation.

[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position MT,20,1012692,-2 EC,6,64885,0 BLL,27,1457074,-17 LEN,50,1706131,0 FITB,28,283754,-13 ARE,26,489883,-2 MPLX,8,90948,-3 Average,23.6,729338,-5.3 [/table]

View table here if you experience formatting issues.

As you can see these stocks had an average of 23.6 hedge funds with bullish positions and the average amount invested in these stocks was $729 million. That figure was $609 million in FAST's case. Lennar Corporation (NYSE:LEN) is the most popular stock in this table. On the other hand Ecopetrol S.A. (NYSE:EC) is the least popular one with only 6 bullish hedge fund positions. Fastenal Company (NASDAQ:FAST) is not the most popular stock in this group but hedge fund interest is still above average. Our overall hedge fund sentiment score for FAST is 61. 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 gained 28.6% in 2021 through November 30th and still beat the market by 5.6 percentage points. Hedge funds were also right about betting on FAST as the stock returned 15.2% since the end of Q3 (through 11/30) and outperformed the market. Hedge funds were rewarded for their relative bullishness.

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Disclosure: None. This article was originally published at Insider Monkey.