I was always wondering, why I could not move or regroup my favourites on my phone, which is a rather small Xperia Active.
On my Asus tablet I could to that by tap and hold any entry and get a sub-menu with some actions.
But holding an entry on the phone did not open a menu.
I wanted to start a post here about my phone's problem, when I noticed, that on the phone tapping and holding an entry makes it flash somewhat. I just kept holding the finger and now could drag and drop the entry to the place where I want it to be, be it inside or outside a group.
But this way only works for resorting the entries. Rename and delete can be done only by tapping on the entry on the phone. On the tablet rename and delete are some of the options of the submenu when tapping and holding (and additional option when shortly tapping and not holding on an entry).