Dallas-based Permian Investment Partners initiated a new position in Resideo Technologies (REZI), adding 965,936 shares valued at approximately $41.7 million, according to a November 14 SEC filing.
What Happened
Permian Investment Partners disclosed a new equity stake in Resideo Technologies (REZI 2.04%) in its quarterly portfolio update filed with the Securities and Exchange Commission (SEC) on November 14. The fund reported acquiring 965,936 shares with an aggregate market value of $41.7 million at quarter-end.
What Else to Know
The new position represents about 4.7% of Permian's $885.7 million in reportable U.S. equity assets as of September 30.
Top five holdings after the filing:
- NYSE:TIC: $193.9 million (21.9% of AUM)
- NASDAQ:GRFS: $173.8 million (19.6% of AUM)
- NYSE:KBR: $150.5 million (17% of AUM)
- NYSE:NRG: $125 million (14.1% of AUM)
- NYSE:ARMK: $81.7 million (9.2% of AUM)
As of Monday, Resideo shares were priced at $36.38, up 39% over the past year and well outperforming the S&P 500, which is up 13% in the same period.
Company Overview
| Metric | Value |
|---|---|
| Price (as of Monday) | $36.38 |
| Market Capitalization | $5.4 billion |
| Revenue (TTM) | $7.4 billion |
| Net Income (TTM) | ($640 million) |
Company Snapshot
- Resideo Technologies offers comfort, residential thermal, and security solutions, including temperature and humidity controls, security panels, sensors, and related software under the Honeywell Home brand.
- The company generates revenue through the sale of products and solutions, as well as the distribution of security, smart home, and connectivity products via the ADI Global Distribution segment.
- It serves commercial and residential end markets, targeting contractors, OEMs, service providers, and retail channels across the United States, Europe, and internationally.
Resideo Technologies, Inc. is a leading provider of comfort and security solutions with a global footprint and a diverse product portfolio. The company leverages its established brands and distribution networks to address the needs of both residential and commercial customers. Its scale and integrated offerings position it competitively in the security and smart home technology sectors.
Foolish Take
Though short-term momentum may be stealing the show, Resideo is not a story about speculative smart home hype. It is a cash-generative industrial technology platform benefiting from scale, pricing discipline, and distribution reach at a time when housing demand remains uneven.
In the third quarter, Resideo delivered $1.86 billion in revenue, up 2% year over year, while posting a record gross margin of 29.8% (up 110 basis points year over year) and record adjusted EBITDA of $229 million, a 21% increase from the prior year. Net income surged to $156 million, reflecting meaningful operating leverage across both its Products and Solutions segment and ADI Global Distribution. Importantly, margin expansion was not isolated. Both segments posted year-over-year gains, underscoring execution rather than one-off cost cuts.
Within the broader portfolio, this position sits well below the fund’s largest holdings, such as TIC Solutions, KBR, and Grifols, suggesting the fund has some measured conviction and isn’t overconcentrating. That matters given shares have fallen about 18% from October highs despite still outperforming the broader market. For patient investors, Resideo offers exposure to infrastructure-like demand in safety, controls, and security, paired with improving profitability. If margin discipline holds, short-term volatility may prove secondary to long-term cash flow durability.
Glossary
Position: The amount of a particular security or asset held by an investor or fund.
Reportable U.S. equity assets: Stocks and related investments in U.S. companies that a fund must disclose in regulatory filings.
Fund AUM: Assets under management; the total market value of investments managed by a fund.
Top five holdings: The five largest investments in a fund's portfolio by market value.
Quarterly portfolio update: A regular report detailing a fund’s investment positions and changes, typically filed every three months.
Aggregate market value: The total dollar value of a group of assets or holdings at current market prices.
Stake: The ownership interest or share held in a company by an investor or fund.
End markets: The final customers or industries that purchase and use a company’s products or services.
OEMs: Original Equipment Manufacturers; companies that produce parts or equipment used in another company’s end products.
Distribution segment: A business division focused on selling and delivering products to retailers, resellers, or end customers.
Integrated offerings: A combination of products and services designed to work together as a complete solution.
TTM: The 12-month period ending with the most recent quarterly report.
