In this article, we will take a look at the 5 best basic materials stocks to buy now. To see more such companies, go directly to 13 Best Basic Materials Stocks to Buy Now.
5. Albemarle Corporation (NYSE:ALB)
Number of Hedge Fund Holders: 46
Chemicals manufacturing company Albemarle Corporation (NYSE:ALB) shares were upgraded recently by BofA to Neutral from Underperform. BofA set a $200 price target on the stock. BofA analyst Matthew DeYoe believes lithium prices could rally on the back of the demand from the EV industry, among other factors.
A total of 46 hedge funds tracked by Insider Monkey have stakes in Albemarle Corporation (NYSE:ALB). The biggest stakeholder of Albemarle Corporation (NYSE:ALB) during this period was Ken Griffin’s Citadel Investment Group which owns a $115 million stake in the company.
4. Newmont Corporation (NYSE:NEM)
Number of Hedge Fund Holders: 50
Earlier this month, Bloomberg reported that Newcrest Mining’s board was prepared to recommend a takeover offer from Newmont (NYSE:NEM) to its shareholders. Newmont Corporation (NYSE:NEM) in April put in a non-binding offer to buy Newcrest in a deal that valued the Australian mining company Newcrest a A$29.4 billion.
A total of 50 hedge funds in Insider Monkey’s database of 943 funds had stakes in Newmont Corporation (NYSE:NEM) as of the end of the fourth quarter. The biggest stakeholder of Newmont Corporation (NYSE:NEM) was First Eagle Investment Management of Jean-Marie Eveillard which had an $868 million stake in the company.
3. Linde plc (NYSE:LIN)
Number of Hedge Fund Holders: 56
Chemicals giant Linde plc (NYSE:LIN) is one of the most notable stocks in the basic materials sector. Last month Linde plc (NYSE:LIN) posted strong Q1 results. Adjusted EPS in the period came in at $3.42, beating estimates by $0.28. Revenue in the quarter was $8.2 billion, in-line with the estimates.
As of the end of the fourth quarter of 2022, 56 hedge funds had stakes in Linde plc (NYSE:LIN). The biggest stakeholder of Linde plc (NYSE:LIN) during this period was Ian Simm’s Impax Asset Management which owns a $945 million stake in the company.
Madison Funds made the following comment about Linde plc (NYSE:LIN) in its fourth-quarter 2022 investor letter:
“Linde plc (NYSE:LIN) stock was strong during the fourth quarter following a solid third quarter. Linde remains well positioned with the passage of the Inflation Reduction Act and energy transition with carbon dioxide sequestration opportunities, gasification services, and various hydrogen projects. Linde and Schlumberger announced that they entered into a collaboration of carbon capture, utilization, and sequestration (CCUS) projects to accelerate decarbonization solutions across industrial and energy sectors. The collaboration will combine decades of experience in carbon dioxide capture and sequestration. The collaboration will focus on hydrogen and ammonia production where carbon dioxide is a by-product. The International Energy Agency estimates that 6 Gigatons of carbon dioxide will need to be abated with CCUS in order to reach net zero by 2050. During the quarter, Linde also announced that it became a signatory to the United Nations Global Compact (UNGC), the world’s largest corporate sustainability initiative. As a signatory, Linde has committed to aligning its strategy and activities with the UNGC’s Ten Principles across human rights, labor, environment, and anti-corruption.”
2. The Sherwin-Williams Company (NYSE:SHW)
Number of Hedge Fund Holders: 64
Ranking 2nd in our list of the best basic materials stocks to buy now is The Sherwin-Williams Company (NYSE:SHW). The paint and coatings company last month posted upbeat first quarter results. Adjusted EPS in the quarter was $2.04, beating estimates by $0.25. Revenue in the period increased by 8.8% year over year to $5.44 billion, surpassing estimates by $300 million.
Insider Monkey’s database of 943 hedge funds shows that 64 hedge funds had stakes in The Sherwin-Williams Company (NYSE:SHW) at the end of the fourth quarter of 2022.
ClearBridge Large Cap Growth Strategy made the following comment about The Sherwin-Williams Company (NYSE:SHW) in its Q4 2022 investor letter:
“A third approach to return generation is purchasing idiosyncratic businesses that largely control their own destiny. We saw mixed results from this group in the fourth quarter, with paint and coatings maker The Sherwin-Williams Company (NYSE:SHW) benefiting from significant pricing power that will allow it to grow earnings handsomely with only modest revenue increases. “
1. Freeport-McMoRan Inc. (NYSE:FCX)
Number of Hedge Fund Holders: 68
Freeport-McMoRan Inc. (NYSE:FCX) in April posted first-quarter results that beat estimates on both earnings and revenue. But the revenue showed a massive decline year over year, mainly because of rains in February at the Grasberg mine in Indonesia.
As of the end of the last quarter of 2022, 68 hedge funds were piled into the company with stakes worth $3.3 billion, according to Insider Monkey’s database. The biggest stakeholder of Freeport-McMoRan Inc. (NYSE:FCX) was Ric Dillon’s Diamond Hill Capital which owns a $415 million stake in the company.
Diamond Hill Large Cap Strategy made the following comment about Freeport-McMoRan Inc. (NYSE:FCX) in its Q4 2022 investor letter:
“Other top contributors during the quarter were copper producer Freeport-McMoRan Inc. (NYSE:FCX) and health care facilities operator HCA Healthcare. With little fundamental news to report, Freeport-McMoRan’s share price advance in Q4 reflected a rebound in copper prices, driven by the recognition that copper inventories are low relative to historical norms. We believe the company continues to have meaningful price and volume leverage in a copper constrained world.”
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