L1 Capital, an investment management firm, released its “L1 Long Short Fund” (unhedged) third-quarter 2025 investor letter. A copy of the letter can be downloaded here. The L1 Long Short Fund (LSF) portfolio generated a return of 13.3% in the September quarter, bringing the calendar-year performance to 28.7%. Dovish Fed commentary, robust U.S. earnings, and a continued momentum in A.I. investment lifted global equities higher in the quarter. The portfolio performed well this quarter, with 19 stocks contributing over 0.5% to returns, and also benefited from rising Gold and Copper prices. In addition, you can check the fund’s top 5 holdings to find out its best picks for 2025.
In its third-quarter 2025 investor letter, L1 Long Short Fund highlighted stocks such as Hudbay Minerals Inc. (NYSE:HBM). Hudbay Minerals Inc. (NYSE:HBM) is a diversified mining company. The one-month return for Hudbay Minerals Inc. (NYSE:HBM) was 18.07%, and its shares gained 115.01% over the last 52 weeks. On December 11, 2025, Hudbay Minerals Inc. (NYSE:HBM) stock closed at $18.62 per share, with a market capitalization of $7.38 billion.
L1 Long Short Fund stated the following regarding Hudbay Minerals Inc. (NYSE:HBM) in its third quarter 2025 investor letter:
“Hudbay Minerals Inc. (NYSE:HBM) (Long +46%) shares rose over the quarter as copper prices moved higher (+2%), most notably in September with Freeport’s Grasberg mine suspending production following a tragic mud slide resulting in fatalities and damage to infrastructure. With 3% of global copper supply, Grasberg’s interruption compounds the impact of other significant ongoing operational disruptions seen elsewhere in the world (e.g. El Teniente, Kamoa-Kakula and Cobre Panama). While copper supply lags, copper demand remains underpinned by powerful growth drivers in electrification, A.I. and defence.
In August, Hudbay announced a US$600m strategic investment from Mitsubishi Corporation in consideration for a 30% interest in its Copper World project. Copper World is a fully permitted project located in Arizona expected to deliver 85ktpa of ‘Made in America’ copper by the end of the decade, which will increase Hudbay’s total copper production by more than 50%. The investment by Mitsubishi was extremely well received by the market as it reduced Hudbay’s required equity share of capital contribution to only ~US$200m (vs. total project capital of ~US$1.1b), implying a robust 90% equity IRR for Hudbay. The transaction was also done at a premium to consensus valuations for the asset, demonstrating the strategic value of domestic U.S. copper production.
Hudbay is a mid-tier mining company, primarily producing copper, along with gold and zinc, with its key assets located in Canada, Arizona and Peru. We are attracted to Hudbay due to our positive medium-term outlook for copper and the company’s ability to generate strong near-term cash flow and recycle capital back into its highly prospective exploration program and major growth projects.”
Hudbay Minerals Inc. (NYSE:HBM) is not on our list of 30 Most Popular Stocks Among Hedge Funds. According to our database, 40 hedge fund portfolios held Hudbay Minerals Inc. (NYSE:HBM) at the end of the third quarter, the same as in the previous quarter. While we acknowledge the risk and potential of Hudbay Minerals Inc. (NYSE:HBM) as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than Hudbay Minerals Inc. (NYSE:HBM) and that has 10,000% upside potential, check out our report about this cheapest AI stock.
In another article, we covered Hudbay Minerals Inc. (NYSE:HBM) and shared the list of best copper stocks to buy. In addition, please check out our hedge fund investor letters Q3 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.
