In this article, we talk about the 10 best high-upside materials stocks to buy.
After underperforming in 2025, the materials sector is expected to rebound in 2026, amid potential tailwinds that could benefit sub-industries such as copper, precious metals, and chemicals, among others, according to Ashley Fernandes, portfolio manager of the Fidelity Advisor Materials Fund.
In his January 7 note on the sector, Fernandes said the materials sector’s growth in 2025 lagged the S&P 500, as uncertainty about shifting U.S. trade policy, Federal Reserve rate-cut decisions, and high consumer inflation weighed on growth in the early part of the year. While uncertainty plagues the U.S. macroeconomic outlook for 2026, positive catalysts, such as stronger consumer spending and corporate earnings, could benefit many materials-sector stocks.
Fernandes highlighted copper and precious metals equities as growth drivers for 2026, as copper demand continues to rise amid constrained supply and industrial demand for metals also picks up. The Fidelity portfolio manager also said that stocks in chemical companies could benefit from the demand generated from the massive artificial intelligence build-out, noting that “valuations for commodity chemicals equities have fallen to a point where there is the potential for recovery as market dynamics change.”
That being said, we’re here with a list of the 10 best high-upside materials stocks to buy.
Photo from Aris Mining Corp.
Our Methodology
We compiled a list of materials-sector companies with market capitalizations of at least $1 billion. Then, to identify the 10 best high-upside materials stocks to buy, we evaluated each stock’s upside and included only those with at least 30% potential upside. Additionally, we also included data on hedge fund holdings in these companies as of Q3 2025 to provide further insight into investor interest.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 427.7% since May 2014, beating its benchmark by 264 percentage points (see more details here).
Note: All pricing data is as of market close on February 6, 2026.
10. Lithium Americas Corp. (NYSE:LAC)
Potential Upside: 32.40%
Number of Hedge Fund Holders: 16
Lithium Americas Corp. (NYSE:LAC) is one of the 10 best high-upside materials stocks to buy. On February 3, Lithium Americas Corp. (NYSE:LAC) announced that it has finalized a series of agreements with the U.S. Department of Energy and General Motors, under which the DOE becomes an investor in Lithium Americas and its joint venture with General Motors.
Under the agreements, implemented on January 30, Lithium Americas Corp. (NYSE:LAC) issued the DOE a warrant to purchase up to 18,268,687 common shares, representing 5% of the company’s outstanding shares. In addition, the joint venture between Lithium Americas Corp. (NYSE:LAC) and General Motors issued a separate warrant for Non-Voting Units representing a 5% economic interest in the joint venture. Both warrants are exercisable for ten years and subject to anti-dilution adjustments.
A registration rights agreement obliges Lithium Americas Corp. (NYSE:LAC) to register for resale the common shares issuable upon exercise of these warrants, while a put, call and exchange agreement gives the DOE the right to sell or exchange its joint venture warrant interests to or through GM Holdings, and grants GM Holdings a corresponding call right after substantial completion milestones at the Thacker Pass project.
Lithium Americas Corp. (NYSE:LAC) is a lithium mining company that focuses on developing, building, and operating lithium deposits and chemical processing facilities in the United States and Canada.
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