Hedge funds recently rotated into winning industrial stocks as their favorite growth darlings underperformed the market, according to RBC. The Wall Street firm analyzed stock-level holdings of 310 hedge funds based on the recently released regulatory filings, and it found that hedge funds’ overweight to the industrial sector hit a new high at the end of the first quarter. The filings reflect holdings as of the end of the first quarter. RBC screened S & P 500 for names with most new positions added by hedge funds to compile their so-called “Hedge Fund Rockets list.” Three of the top six names on the list turned out to be industrials, RBC said. Lockheed Martin was one of the industrial stocks loved by hedge funds last quarter. The defense name has rallied 24% this year as Russia’s attack on Ukraine has boosted demand for Lockheed Martin’s missile defense systems. Hedge funds bought into industrials and other cyclical names while the funds were going through their worst stretch on record due to tech’s steep losses this year, according to Goldman Sachs. The underperformance came as growth-oriented stocks became the epicenter of 2022?s market sell-off in the face of rising interest rates. Union Pacific was another popular new bet by hedge funds in the first quarter. The railroad company is down about 13% in 2022. Outside of the industrial space, a total of 20 hedge funds initiated a new position in Nielsen Holdings in the first quarter. The information, data and market measurement firm has risen more than 24% this year, significantly outperforming the S & P 500.