Do Hedge Funds Love Thomson Reuters Corporation (USA) (TRI)?

Since Thomson Reuters Corporation (USA) (NYSE:TRI) has faced falling interest from the smart money, logic holds that there is a sect of hedge funds that elected to cut their full holdings by the end of the third quarter. Interestingly, D. E. Shaw’s D E Shaw dropped the biggest position of the “upper crust” of funds monitored by Insider Monkey, comprising close to $7.4 million in stock. Ray Carroll’s fund, Breton Hill Capital, also dropped its investment, about $6.5 million worth of shares. These bearish behaviors are intriguing to say the least, as aggregate hedge fund interest fell by 5 funds by the end of the third quarter.

Let’s also examine hedge fund activity in other stocks – not necessarily in the same industry as Thomson Reuters Corporation (USA) (NYSE:TRI) but similarly valued. These stocks are Broadcom Corporation (NASDAQ:BRCM), Travelers Companies Inc (NYSE:TRV), Brookfield Asset Management Inc. (USA) (NYSE:BAM), and Sony Corporation (ADR) (NYSE:SNE). This group of stocks’ market valuations are closest to TRI’s market valuation.

As you can see these stocks had an average of 36 hedge funds with bullish positions and the average amount invested in these stocks was $2.29 billion. That figure was $242 million in TRI’s case. Broadcom Corporation (NASDAQ:BRCM) is leading the pack, while Sony Corporation (ADR) (NYSE:SNE) is the least popular one with only 21 bullish hedge fund positions. Compared to these stocks Thomson Reuters Corporation (USA) (NYSE:TRI) is even less popular than SNE. Considering that hedge funds aren’t fond of this stock in relation to other companies analyzed in this article, it may be a good idea to analyze it in detail and understand why the smart money isn’t behind this stock. This isn’t necessarily bad news. Although it is possible that hedge funds may think the stock is overpriced and view the stock as a short candidate, they may not be very familiar with the bullish thesis. In either case more research is warranted.