Do Hedge Funds Love Frontline Ltd (FRO)?

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Because Frontline Ltd (NYSE:FRO) has faced a bearish sentiment from the smart money, it’s easy to see that there lies a certain “tier” of hedge funds that slashed their positions entirely in the third quarter. At the top of the heap, Glenn Russell Dubin’s Highbridge Capital Management dumped the largest stake of the 700 funds tracked by Insider Monkey, totaling an estimated $0.5 million in stock. Ben Levine, Andrew Manuel and Stefan Renold’s fund, LMR Partners, also dropped its stock, about $0.5 million worth of shares. These bearish behaviors are intriguing to say the least, as aggregate hedge fund interest stayed the same (this is a bearish signal in our experience).

Let’s now review hedge fund activity in other stocks – not necessarily in the same industry as Frontline Ltd (NYSE:FRO) but similarly valued. These stocks are The Marcus Corporation (NYSE:MCS), Haverty Furniture Companies, Inc. (NYSE:HVT), Unifi, Inc. (NYSE:UFI), and Blackrock Muni Intermediate Drtn Fnd Inc (NYSE:MUI). This group of stocks’ market values resemble Frontline Ltd (NYSE:FRO)’s market value.

Ticker No of HFs with positions Total Value of HF Positions (x1000) Change in HF Position
MCS 12 49694 1
HVT 12 73201 1
UFI 9 56219 0
MUI 4 3557 0

As you can see, these stocks had an average of 9 hedge funds with bullish positions and the average amount invested in these stocks was $46 million. That figure was $16 million in Frontline Ltd (NYSE:FRO)’s case. The Marcus Corporation (NYSE:MCS) is the most popular stock in this table. On the other hand, Blackrock Muni Intermediate Drtn Fnd Inc (NYSE:MUI) is the least popular one with only 4 bullish hedge fund positions. Compared to these stocks, Frontline Ltd (NYSE:FRO) is more popular among hedge funds. Considering that hedge funds are fond of this stock in relation to its market cap peers, it may be a good idea to analyze it in detail and potentially include it in your portfolio.

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