Citi's Quant group released a positioning analysis focused on US chemicals stocks within the firm's coverage universe, identifying where investor exposure is most concentrated on both the long and short sides.
Top crowded long positions
Ecovyst (ECVT), RPM International (RPM) and Linde (LIN) were reported as the most crowded long names across Citi's coverage. The firm noted that RPM and LIN exchanged places during the past week. Linde's crowding score declined by roughly 1% week-over-week, a move Citi attributed to weaker sentiment and a less favorable historical relative valuation, which was partially offset by a decline in short interest.
Across the coverage universe, Citi found that long crowding increased by approximately 1% week-over-week, following a roughly 6% decline the prior week.
Notable weekly movers
- Axalta Coating Systems (AXTA) rose 8.9% week-over-week.
- Celanese (CE) gained 6.4% week-over-week.
- Eastman Chemical (EMN) increased 5.7% week-over-week.
- H.B. Fuller (FUL) was up 4.1% week-over-week.
- PPG Industries (PPG) moved down 3.7% week-over-week.
- Dow (DOW) fell 6.2% week-over-week.
Citi highlighted that H.B. Fuller recorded the largest decline in long crowding over the past month, dropping approximately 36% month-over-month. The firm linked this decline to heightened pressure from activist investors after Ancora made a cash offer for the company's BAS segment.
Most crowded short positions and broader short crowding trends
PPG Industries, FMC Corporation (FMC) and H.B. Fuller remained the most crowded short positions in Citi's coverage. The report noted that average short crowding across the coverage universe declined by about 1% week-over-week, extending a trend that included a roughly 3% decline in the prior week.
Most debated names and methodology
Sherwin-Williams (SHW), Axalta Coating Systems and RPM International were identified as the most debated names, with debate measured by the sum of long and short composite scores.
Citi's quant framework for determining crowding relies on five distinct factors: most crowded factor, relative historical valuation, short interest ratio, sentiment, and macro exposure. These inputs are combined to generate composite crowding metrics that the report uses to rank names within the coverage universe.
Members of equity investor and analyst communities who follow chemicals sector positioning will find the report useful for understanding where exposures are concentrated and how those concentrated positions have shifted over recent weekly and monthly intervals.