Is Rexnord Corp (RXN) A Good Stock To Buy?

With a general bullishness amongst the heavyweights, key hedge funds were breaking ground themselves. Nine Chapters Capital Management, managed by Chao Ku, established the most outsized position in Rexnord Corp (NYSE:RXN). The fund reportedly had $1.3 million invested in the company at the end of the quarter. Peter Rathjens, Bruce Clarke and John Campbell’s Arrowstreet Capital also initiated a $1 million position during the quarter. The other funds with brand new RXN positions are Peter Muller’s PDT Partners, Paul Marshall and Ian Wace’s Marshall Wace LLP, and Benjamin A. Smith’s Laurion Capital Management.

Let’s go over hedge fund activity in other stocks similar to Rexnord Corp (NYSE:RXN). These stocks are Ligand Pharmaceuticals Inc. (NASDAQ:LGND), Select Income REIT (NYSE:SIR), Washington Real Estate Investment Trust (NYSE:WRE), and Holly Energy Partners, L.P. (NYSE:HEP). This group of stocks’ market valuations match RXN’s market valuation.

As you can see these stocks had an average of 10 hedge funds with bullish positions and the average amount invested in these stocks was $77 million. That figure was $166 million in RXN’s case. Ligand Pharmaceuticals Inc. (NASDAQ:LGND) is the most popular stock in this table, while Washington Real Estate Investment Trust (NYSE:WRE) and Holly Energy Partners, L.P. (NYSE:HEP) are the laggards with only 5 bullish hedge fund positions. Compared to these stocks Rexnord Corp (NYSE:RXN) is more popular among hedge funds and the amount invested is significantly north of the average. 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.