Is Royal Gold, Inc USA) (RGLD) A Good Stock To Buy?

As one would reasonably expect, key hedge funds were leading the bulls’ herd. 3G Capital, managed by Jorge Paulo Lemann, established the biggest position in Royal Gold, Inc USA) (NASDAQ:RGLD). 3G Capital had $11.7 million invested in the company at the end of the quarter. Glenn Russell Dubin’s Highbridge Capital Management also initiated a $7.4 million position during the quarter. The other funds with brand new Royal Gold, Inc USA) (NASDAQ:RGLD) positions are Paul Marshall and Ian Wace’s Marshall Wace LLP, Joel Greenblatt’s Gotham Asset Management, and Paul Tudor Jones’s Tudor Investment Corp.

Let’s now take a look at hedge fund activity in other stocks – not necessarily in the same industry as Royal Gold, Inc USA) (NASDAQ:RGLD) but similarly valued. These stocks are WuXi PharmaTech (Cayman) Inc. (ADR) (NYSE:WX), MPLX LP (NYSE:MPLX), American Eagle Outfitters (NYSE:AEO), and Industrias Bachoco, S.A.B. de C.V. (ADR) (NYSE:IBA). All of these stocks’ market caps match Royal Gold, Inc USA) (NASDAQ:RGLD)’s market cap.

As you can see, these stocks had an average of 20 hedge funds with bullish positions and the average amount invested in these stocks was $259 million. That figure was $354 million in Royal Gold, Inc USA) (NASDAQ:RGLD)’s case. American Eagle Outfitters (NYSE:AEO) is the most popular stock in this table. On the other hand, Industrias Bachoco, S.A.B. de C.V. (ADR) (NYSE:IBA) is the least popular one with only 5 bullish hedge fund positions. Royal Gold, Inc USA) (NASDAQ:RGLD) is not the most popular stock in this group, but hedge fund interest is still above average. This is a slightly positive signal, but we’d rather spend our time researching stocks that hedge funds are piling on. In this regard, American Eagle Outfitters (NYSE:AEO) might be a better candidate to consider a long position.