Citi analyzes positioning in US chemicals stocks

Investing.com - Citi released a positioning analysis of US chemicals stocks using data from its Quant team, identifying the most crowded long and short positions within its coverage universe.

Ecovyst (NYSE: ECVT), RPM International (NYSE: RPM), and Linde (NASDAQ: LIN) remain the most crowded long positions in Citi's coverage. RPM and LIN swapped positions during the week, with LIN's crowding score declining roughly 1% week-over-week due to weaker sentiment and less favorable historical relative valuation, partially offset by lower short interest. Long crowding across Citi's coverage universe increased approximately 1% week-over-week, rebounding from a roughly 6% decline the previous week.

The largest weekly movers included Axalta Coating Systems (NYSE: AXTA), up 8.9% week-over-week, Celanese (NYSE: CE), up 6.4%, Eastman Chemical (NYSE: EMN), up 5.7%, H.B. Fuller (NYSE: FUL), up 4.1%, PPG Industries (NYSE: PPG), down 3.7%, and Dow (NYSE: DOW), down 6.2%. H.B. Fuller experienced the sharpest decline in long crowding over the past month, falling roughly 36% month-over-month amid heightened pressure from activist investors following Ancora's cash offer for the BAS segment.

PPG Industries, FMC Corporation (NYSE: FMC), and H.B. Fuller continue to be the most crowded short positions within Citi's coverage. Average short crowding for the coverage universe declined approximately 1% week-over-week, continuing the previous week's trend of a roughly 3% decline.

Sherwin-Williams (NYSE: SHW), Axalta Coating Systems, and RPM International remain the most debated names, measured by the sum of long and short composite scores. Citi's quant team uses five factors to determine crowding: most crowded factor, relative historical valuation, short interest ratio, sentiment, and macro exposure.

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