Is RigNet Inc (RNET) Going to Burn These Hedge Funds?

As aggregate interest increased, specific money managers have been driving this bullishness. Rutabaga Capital Management assembled the biggest position in RigNet Inc (NASDAQ:RNET). AlphaOne Capital Partners also initiated a $1.9 million position during the quarter. The other funds with brand new RNET positions are John Overdeck and David Siegel’s Two Sigma Advisors and Chao Ku’s Nine Chapters Capital Management.

Let’s also examine hedge fund activity in other stocks – not necessarily in the same industry as RigNet Inc (NASDAQ:RNET) but similarly valued. These stocks are RAIT Financial Trust (NYSE:RAS), Tejon Ranch Company (NYSE:TRC), Steel Partners Holdings LP (NYSE:SPLP), and Timkensteel Corp (NYSE:TMST). This group of stocks’ market valuations are similar to RNET’s market valuation.

As you can see these stocks had an average of 11 hedge funds with bullish positions and the average amount invested in these stocks was $66 million, slightly higher than the $40 million figure in RNET’s case. Timkensteel Corp (NYSE:TMST) is the most popular stock in this table. On the other hand, Tejon Ranch Company (NYSE:TRC) is the least popular one with only 6 bullish hedge fund positions. RigNet Inc (NASDAQ:RNET) 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 TMST might be a better candidate to consider a long position.