In this article, we will take a look at the 12 Best Mid-Cap Materials Stocks to Buy Now.
In 2025, the U.S. construction and materials sector entered an uncertain era. The industry is currently focused on two areas: changes in domestic immigration policy and new developments in international trade that could affect the cost of building materials. As such, it should come as no surprise to anyone that 2025 is shaping up to be a crucial year for the sector, given that the current cycle’s building activity is slowing down.
However, there are still advancements that encourage market growth and competition. Cognitive Market Research projects that the global materials market, which encompasses metals, polymers, ceramics, and composites, will increase at a compound annual growth rate (CAGR) of 5.2% to reach $1.9 trillion by 2026.
To that end, technological advancements appear as a major driver of the industry . In recent times, engineers and builders employ 4D and 5D simulations to solve workflow problems brought on by worker shortages and scheduling conflicts. The transition of the materials sector to sector 4.0 and the establishment of a “smart factory” also seems to be well advanced.
That being said, let us now take a look at the list of the 12 best mid-cap materials stocks to buy now.
Our Methodology
For this list, we started by screening for companies in the materials sector with a market capitalization between $2 billion and $10 billion. From this filtered group, we ranked the stocks based on the number of hedge funds holding positions, using data from the Insider Monkey database.
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 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
12. Knife River Corporation (NYSE:KNF)
Market Capitalization: $5.20 billion
Number of Hedge Fund Holders: 24
Knife River Corporation (NYSE:KNF) ranks among the best mid-cap materials stocks to buy now. Wells Fargo maintained its Overweight rating on Knife River Corporation (NYSE:KNF) and raised its price target from $96 to $97 on August 11. The update came despite Knife River’s lower-than-expected second-quarter performance and lowered outlook for the current period.
According to Wells Fargo, the factors behind Knife River’s performance failure are “transitory,” with the firm citing weather-related problems and Oregon state financing difficulties as particular short-term obstacles.
The firm pointed to Knife River’s increasing backlog as a sign of strength, indicating that it may position the company for “a very strong 2026,” as long as management continues to focus on bolt-on acquisitions and operational enhancements.
Knife River Corporation (NYSE:KNF) offers contractual services and construction supplies based on aggregates. The company provides its services and building supplies across the central, southern, and western United States.
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