Here is What Hedge Funds Think About Tronox Ltd (TROX)

Because Tronox Ltd (NYSE:TROX) has experienced bearish sentiment from the smart money, logic holds that there lies a certain “tier” of hedgies that decided to sell off their positions entirely last quarter. It’s worth mentioning that Jamie Zimmerman’s Litespeed Management dumped the largest position of the 700 funds followed by Insider Monkey, worth about $44.6 million in stock. Michael Kaine’s fund, Numina Capital, also cut its holding, dropping about $8.3 million worth of shares. These moves are interesting, as total hedge fund interest was cut by 5 funds last quarter.

Let’s now review hedge fund activity in other stocks similar to Tronox Ltd (NYSE:TROX). These stocks are HomeStreet Inc (NASDAQ:HMST), First Trust High Income Long/short Fund (NYSE:FSD), SunCoke Energy, Inc (NYSE:SXC), and Helix Energy Solutions Group Inc. (NYSE:HLX). This group of stocks’ market values are similar to TROX’s market value.

As you can see these stocks had an average of 17 hedge funds with bullish positions and the average amount invested in these stocks was $69 million. That figure was $50 million in TROX’s case. SunCoke Energy, Inc (NYSE:SXC) is the most popular stock in this table, whereas First Trust High Income Long/short Fund (NYSE:FSD) is the least popular one with only 6 bullish hedge fund positions. Tronox Ltd (NYSE:TROX) is not the least popular stock in this group, but hedge fund interest is still below average. This is a slightly negative signal and we’d rather spend our time researching stocks that hedge funds are piling on. In this regard SXC might be a better candidate to consider a long position.