Ashland (ASH) Fell Despite Earnings Met Expectations

Diamond Hill Capital, an investment management company, released its “Mid Cap Strategy” investor letter for the first quarter of 2025. A copy of the letter can be downloaded here. The first quarter of 2025 was mixed due to a flurry of activity from the new presidential administration. However, the strategy outperformed the Russell Midcap Index in Q1, returning -1.26% (net) vs -3.40% for the index. In addition, you can check the top 5 holdings of the strategy to know its best picks in 2025.

In its first-quarter 2025 investor letter, Diamond Hill Mid Cap Strategy highlighted stocks such as Ashland Inc. (NYSE:ASH). Ashland Inc. (NYSE:ASH) offers additives and specialty ingredients that operates through Life Sciences, Personal Care, Specialty Additives, and Intermediates segments. The one-month return of Ashland Inc. (NYSE:ASH) was -1.06%, and its shares lost 50.50% of their value over the last 52 weeks. On June 5, 2025, Ashland Inc. (NYSE:ASH) stock closed at $49.56 per share, with a market capitalization of $2.26 billion.

Diamond Hill Mid Cap Strategy stated the following regarding Ashland Inc. (NYSE:ASH) in its Q1 2025 investor letter:

“Other bottom individual contributors in Q1 included Ciena, Teleflex and Ashland Inc. (NYSE:ASH). Shares of specialty chemical manufacturer Ashland have been pressured by dour sentiment, even as earnings have generally met expectations. The company has indicated that potential tariffs should not particularly affect it, given that most of its production locations and end markets are well matched within countries. Regardless, investors seem relatively unconvinced and are possibly also factoring in broader economic growth concerns.”

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A female executive surrounded by a team of employees in a manufacturing factory manipulating advanced materials and chemicals.

Ashland Inc. (NYSE:ASH) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 32 hedge fund portfolios held Ashland Inc. (NYSE:ASH) at the end of the first quarter, which was 24 in the previous quarter. In the second quarter of fiscal 2025, Ashland Inc.’s (NYSE:ASH) sales declined 17% year-over-year to $479 million. While we acknowledge the potential of Ashland Inc. (NYSE:ASH) as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is as promising as NVIDIA but that trades at less than 5 times its earnings, check out our report about the undervalued AI stock set for massive gains.

In another article, we covered Ashland Inc. (NYSE:ASH) and shared the list of most undervalued stocks with smart money ratings. In addition, please check out our hedge fund investor letters Q1 2025 page for more investor letters from hedge funds and other leading investors.

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Disclosure: None. This article is originally published at Insider Monkey.