Is Schnitzer Steel Industries, Inc. (SCHN) A Good Stock To Buy?

Due to the fact that Schnitzer Steel Industries, Inc. (NASDAQ:SCHN) has gone through a decline in interest from the aggregate hedge fund industry, logic holds that there lies a certain “tier” of money managers that slashed their entire stakes by the end of the third quarter. Intriguingly, David Costen Haley’s HBK Investments cashed in the biggest stake of all the investors watched by Insider Monkey, worth about $0.4 million in stock, and Joshua Packwood and Schuster Tanger’s Radix Partners was right behind this move, as the fund cut about $0.4 million worth of shares.

Let’s go over hedge fund activity in other stocks – not necessarily in the same industry as Schnitzer Steel Industries, Inc. (NASDAQ:SCHN) but similarly valued. We will take a look at AEP Industries (NASDAQ:AEPI), Connecticut Water Service, Inc. (NASDAQ:CTWS), REX American Resources Corp (NYSE:REX), and Pace Holdings Corp (NASDAQ:PACE). This group of stocks’ market valuations are closest to SCHN’s market valuation.

As you can see these stocks had an average of 12 hedge funds with bullish positions and the average amount invested in these stocks was $115 million. That figure was $92 million in SCHN’s case. Pace Holdings Corp (NASDAQ:PACE) is the most popular stock in this table. On the other hand Connecticut Water Service, Inc. (NASDAQ:CTWS) is the least popular one with only 6 bullish hedge fund positions. Schnitzer Steel Industries, Inc. (NASDAQ:SCHN) 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 PACE might be a better candidate to consider taking a long position in.