In this article, we will discuss the Top 10 Materials Stocks to Buy According to Analysts.
Materials stocks are shares of companies that produce or supply raw materials, including metals, chemicals, and construction supplies. These stocks typically rise or fall in response to industrial demand for materials used in manufacturing, construction, and emerging technologies.
The materials sector is experiencing a notable resurgence in 2025 following several challenging years. In the past six months alone (as of July 3, 2025), the S&P 500 Materials index has gained 8.78%, outpacing the broader S&P 500’s 6.76% return. This marks the first time in two years that the Materials index is outperforming the broad market.
Analysts had identified compelling opportunities within the sector well before this turnaround materialized. Fidelity analysts projected a “bullish long-term story” for the materials sector in 2025 and beyond, while McKinsey emphasized that the ongoing energy transition is fundamentally reshaping the materials landscape. McKinsey outlined three major shifts: rising demand for materials embedded in low-carbon technologies, a shift in demand toward metals like lithium, copper, and nickel, and a decline in thermal coal’s role in the energy system.
Sector-specific dynamics further reinforce the investment thesis. Analysts are most optimistic about the Basic Materials subsector, supported by improving market conditions. According to Morningstar analysts, lithium—a key material driving the electric vehicle revolution—reached multi-year lows in 2024 “as supply grew faster than demand in 2023 and 2024.” However, the analysts note that “demand continues to increase from higher global electric vehicle sales and the buildout of utility-scale batteries used in energy storage systems.” They forecast higher prices in the near term as supply cuts move the market closer to balance, particularly in the second half of 2025.
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Our Methodology
To identify the top 10 materials stocks favored by analysts, we compiled the initial pool of materials companies by analyzing sector-specific ETF holdings and established industry rankings. Our selection criteria focused on companies with favorable analyst coverage. To enhance our analysis, we incorporated hedge fund sentiment as a key validation metric, utilizing institutional holding data from Insider Monkey’s database as of Q1 2025. The final list prioritizes stocks based on their average upside potential, measured as of July 7, 2025.
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).
Top 10 Materials Stocks to Buy According to Analysts
10. Newmont Corporation (NYSE:NEM)
Average Upside Potential as of July 7: 9.17%
Number of Hedge Fund Holders: 65
Newmont Corporation (NYSE:NEM) is one of the top 10 materials stocks to buy according to analysts. On July 3, the company’s “Buy” rating was reaffirmed at UBS. UBS also raised the price target for Newmont’s stock to $68 from $60.
According to UBS, gold prices have “repeatedly reached new highs this year.” They stated that, at one point, the prices surpassed $3,500 per ounce, marking an almost 30% increase since the beginning of the year. This surge in gold prices, amidst an “uncertain trade war outlook and escalating concerns about an economic recession,” is noted as a significant opportunity for investors in gold mining stocks like Newmont.
UBS analysts also touched on Newmont’s financial performance. They noted that the company reported strong Q1 FY2025 earnings, with earnings per share (EPS) of $1.25, significantly exceeding analysts’ consensus estimates of $0.71. The analysts also noted that the company is on track to meet its 2025 guidance, with the first-quarter results aligning with the indications provided in February 2025.
Newmont Corporation (NYSE:NEM), one of the world’s largest gold mining companies, operates across five continents and is a producer of copper, silver, zinc, and lead. Its flagship assets include Boddington in Australia and Yanacocha in Peru. The company plays a vital role in supplying metals essential for global electrification and infrastructure. Some of Newmont’s standout aspects include its large-scale operations, strong cash generation, and strategic diversification across multiple geographies and commodities.
9. The Sherwin-Williams Company (NYSE:SHW)
Average Upside Potential as of July 7: 10.11%
Number of Hedge Fund Holders: 68
The Sherwin-Williams Company (NYSE:SHW) is one of the top 10 materials stocks to buy according to analysts. On June 13, Citi lowered its rating on Sherwin-Williams stock from Buy to Neutral, citing concerns about the housing market’s future prospects. The firm also reduced its price target from $405.00 to $385.00.
Citi analysts pointed to “sustained pressure from elevated mortgage rates” as a significant factor. They also cited “delayed expectations for Federal Reserve rate cuts,” which are “dampening hopes for a meaningful housing recovery in the second half of 2025.” The firm noted suppressed housing dynamics, including sluggish existing home sales and a challenging environment for homebuilders, indicating few signs of a market recovery in the latter half of the year.
While the analysts acknowledge Sherwin-Williams as a strong long-term player with solid market share potential and view its long-term market share growth story as intact, they believe current conditions suggest limited upside in the short term. As such, the firm stated that without clear near-term catalysts, the stock’s risk-reward profile is less compelling. The research note suggested that investors wait for a better entry point before purchasing Sherwin-Williams shares.
The Sherwin-Williams Company (NYSE:SHW) develops, manufactures, and sells paints, coatings, and related products to professional, industrial, commercial, and retail customers. With operations across the Americas, Europe, Asia, and Australia, it serves markets through brands like Valspar and its own Sherwin-Williams stores. Analysts favor the company for its scale, global reach, and consistent dividend growth, having raised its payout for 48 consecutive years.
8. Rio Tinto Group (NYSE:RIO)
Average Upside Potential as of July 7: 12.67%
Number of Hedge Fund Holders: 36
Rio Tinto Group (NYSE:RIO) is one of the top 10 materials stocks to buy according to analysts. On July 2, Aluminerie Alouette, an aluminum producer partially owned by Rio Tinto Plc, announced plans to invest up to C$1.5 billion (approximately $1.1 billion) to modernize its operations in northern Quebec, according to sources familiar with the matter.
The Sept-Îles smelter employs approximately 900 people and has an annual production capacity of 630,000 metric tons of primary aluminum. The investment will fund technological upgrades to the smelter’s infrastructure, energy efficiency improvements in production processes, enhanced production capabilities to maintain competitiveness, and strengthened environmental controls and monitoring systems. Bloomberg cited sources who said that Aluminerie Alouette has secured a new electricity supply deal with Hydro-Québec, the Quebec government-owned power utility, to support the project.
The modernized project is expected to support 900 direct jobs at the smelter. It will also create thousands of indirect jobs in the regional supply chain, enhance the tax base for municipal and provincial governments, and provide supply chain security for industries like aerospace and beverage packaging.
Rio Tinto Group (NYSE:RIO) is classified as a material stock because it operates in the basic materials sector, focusing on the exploration, mining, and processing of key industrial metals like iron ore, aluminum, copper, lithium, and titanium dioxide. With operations spanning over 35 countries, the company plays a crucial role in supplying raw materials for global infrastructure, manufacturing, and clean energy. Among its standout assets are the Pilbara iron ore mines in Australia and the Oyu Tolgoi copper-gold mine in Mongolia. Rio Tinto plays a pivotal role in the energy transition, particularly through its strategic investments in battery materials, such as lithium.
7. International Paper Company (NYSE:IP)
Average Upside Potential as of July 7: 13.78%
Number of Hedge Fund Holders: 49
International Paper Company (NYSE:IP) is one of the top 10 materials stocks to buy according to analysts. On July 1, the company finalized the sale of five European corrugated packaging plants to PALM Group. PALM Group is a Germany-based producer of containerboard, graphic paper, and corrugated packaging.
According to a press release, the sale was a regulatory requirement to address competition concerns arising from the company’s acquisition of DS Smith Plc, a UK-based packaging company, which was completed earlier in 2025. The European Commission mandated the divestiture on January 24, 2025, to ensure compliance with antitrust regulations. The divested plants include three facilities in Normandy, France, one box plant in Ovar, Portugal, and one box plant in Bilbao, Spain.
With the completion of this sale, International Paper has “satisfied all of its obligations towards the European Commission in connection with the acquisition of DS Smith Plc.” On the other hand, PALM Group now has an additional five sites, which means it now operates 33 corrugated box plants across Europe.
International Paper Company (NYSE:IP) is a Memphis, Tennessee-based manufacturer of fiber-based packaging and pulp products. It operates through two segments (Industrial Packaging and Global Cellulose Fibers) and serves markets across North America, Latin America, Europe, and North Africa. The company’s offerings include containerboard, corrugated packaging, and specialty pulps used in personal care and industrial applications.
6. Ternium S.A. (NYSE:TX)
Average Upside Potential as of July 7: 14.31%
Number of Hedge Fund Holders: 9
Ternium S.A. (NYSE:TX) is one of the top 10 materials stocks to buy according to analysts. On June 19, during a presentation to analysts in New York, Ternium called on the United States, Mexico, and Canada to reinforce the United States-Mexico-Canada Agreement (USMCA). The company emphasized the need for enhanced terms to address trade challenges in the face of new U.S. steel tariffs.
For context, on June 4, 2025, U.S. President Donald Trump doubled the tariffs on steel and aluminum imports to 50%. The move impacted Mexican steel exports unless they comply with USMCA’s strict “rules of origin” requirements, which mandate a high percentage of North American content. Shipments from Mexico to the U.S. under the USMCA are generally exempt from these tariffs; however, non-compliant steel products face a 50% duty.
Against this background, Ternium advocated for tougher “rules of origin” to prevent countries like China from routing steel through Mexico to bypass U.S. tariffs. Reuters reported that Ternium highlighted that these rules are critical to protecting North American steel industries from unfair trade practices.
Ternium S.A. (NYSE:TX), based in Luxembourg, is a leading steel manufacturer with operations spanning Mexico, Brazil, Argentina, and other Latin American markets. It produces a wide range of flat and long steel products, as well as iron ore, through its mining segment. The company exported 2.3 million tons of steel to the U.S. in 2024. Analysts view Ternium as a compelling investment opportunity due to its vertical integration, regional dominance, and strategic investments in energy-efficient production and supply chain resilience.
5. DuPont de Nemours, Inc. (NYSE:DD)
Average Upside Potential as of July 7: 14.79%
Number of Hedge Fund Holders: 64
DuPont de Nemours, Inc. (NYSE:DD) is one of the top 10 materials stocks to buy according to analysts. On June 25, the company announced that its Board of Directors declared a $0.41 per share quarterly dividend on its outstanding Common Stock. The dividend is payable on September 15, 2025, to shareholders of record as of the close of business on August 29, 2025.
The dividend payment is the same as the rate for the quarter ended April 2025. In February, the company announced that the Board had declared a quarterly dividend of $0.41 per share, representing an 8% increase from 2024. The dividend for Q4 2024 was $0.38 per share, announced on October 16, 2024. Compared to 2023, when dividends were $0.36 per share for most quarters, the 2025 dividend reflects a 13.9% increase.
Analysis shows that DuPont has increased its dividend for four consecutive years. The consistent $0.41 dividend in 2025 aligns with the company’s robust financial results in 2024 and Q1 2025. In full-year 2024, the company’s net sales increased by 7%, and earnings per share grew by 17%. Operating EBITDA grew by 16% in Q1 2025 to $788 million.
DuPont de Nemours, Inc. (NYSE:DD), headquartered in Wilmington, Delaware, provides technology-driven materials and solutions across the electronics, transportation, construction, water, and healthcare sectors.
4. Agnico Eagle Mines Limited (NYSE:AEM)
Average Upside Potential as of July 7: 15.83%
Number of Hedge Fund Holders: 50
Agnico Eagle Mines Limited (NYSE:AEM) is one of the top 10 materials stocks to buy according to analysts. Investor interest in gold equities remains strong but measured, and AEM is emerging as a key focus among mid-cap gold stocks. In a June 29 note, RBC Capital Markets highlighted that while catalysts are limited across most senior North American producers, Agnico Eagle stands out for its solid fundamentals and growing investor attention.
Alongside IAMGold and Equinox, AEM has attracted heightened interest amid a broader rally in gold prices—up roughly 25% year-to-date—as investors seek safe-haven assets. With macroeconomic uncertainty, including muted U.S. inflation and potential Fed rate cuts, Agnico Eagle’s operational strength and global footprint position it as a compelling name in the gold sector.
Agnico Eagle Mines Limited (NYSE:AEM), headquartered in Toronto, is a senior gold producer with mining operations in Canada, Australia, Finland, and Mexico. The company explores and develops precious metals, including silver, copper, and zinc. Analysts view Agnico Eagle as a top pick for its disciplined capital allocation, strong production growth, and strategic exposure to gold amid rising demand for safe-haven assets and electrification-linked metals.
3. CRH PLC (NYSE:CRH)
Average Upside Potential as of July 7: 17.07%
Number of Hedge Fund Holders: 91
CRH PLC (NYSE:CRH) is one of the top 10 materials stocks to buy according to analysts. On June 30, Morgan Stanley increased its price target on CRH to $110.00 from the previous $106.00. The firm continues to hold an “Overweight” rating on CRH stock.
Morgan Stanley based their decision on CRH’s EBITDA growth. The analysts cited a 1% increase in CRH’s FY25 EBITDA forecast and a 2% increase for FY26. These increases, the firm noted, are driven by a weaker U.S. dollar, which boosts the EBITDA of CRH’s International Solutions segment. The firm’s FY25 EBITDA estimate is 3% above the Visible Alpha consensus, primarily due to CRH’s recent merger and acquisition activities, which are expected to enhance financial performance. The new price target of $110, according to Morgan Stanley, reflects a “rerating of sum-of-the-parts peers.”
For Q2 2025, Morgan Stanley forecasted EBITDA of $2.41 billion, aligning with consensus estimates. However, they expect lower year-over-year EBITDA margins due to reduced land sales in the Americas Materials segment, the impact of the Adbri acquisition in the International Solutions segment, and continued negative organic trends in the Americas Building Solutions segment.
CRH PLC (NYSE: CRH) is a global leader in the building materials industry. The company is headquartered in Dublin, Ireland, and supplies aggregates, cement, asphalt, and concrete products for infrastructure, commercial, and residential projects. It operates across North America, Europe, and Australia, serving critical sectors such as transportation, energy, and telecommunications. CRH’s strategic shift toward North America, robust cash flows, and exposure to long-term infrastructure spending are key reasons for its inclusion among top-rated materials stocks.
2. Vale S.A. (NYSE:VALE)
Average Upside Potential as of July 7: 17.12%
Number of Hedge Fund Holders: 37
Vale S.A. (NYSE:VALE) is one of the top 10 materials stocks to buy according to analysts. On July 2, Brazilian mining giant Vale revised down its 2025 iron ore agglomerates production forecast, citing ongoing challenges in the pellet market due to oversupply and declining demand for premium-grade materials.
The new forecast range is 31 million to 35 million metric tons (Mt). This is a significant reduction from its previous estimate of 38 Mt to 42 Mt. The primary basis for the revision, Reuters reports, is “current market conditions for pellets.” The market is characterized by concerns over oversupply and reduced demand for high-quality products. There is also a shift in the steel industry. According to the report, steelmakers, facing “tightened margins” due to falling steel prices, are increasingly “preferring cheaper ore of lower quality over pellets with high costs.” This has led some producers, including Vale, to prioritize sales of “fines” (lower-grade powdered ore).
Meanwhile, Samarco, a joint venture between Vale and BHP (NYSE:BHP), is ramping up its pellet production. This will add approximately 8 million tons of pellets and pellet feed to the market, further contributing to the existing oversupply.
Vale S.A. (NYSE:VALE) is a Brazilian company that is one of the world’s largest producers of iron ore and nickel. It also produces copper, cobalt, and precious metals. Its integrated logistics network—including railways, ports, and distribution centers—supports efficient global delivery across more than 30 countries. The company stands out in the materials space for its low-cost production model, strategic investments in energy transition metals, and ambitious plans to expand iron ore capacity and reduce cash costs. This positions it as a key beneficiary of rising demand for infrastructure and electrification.
1. Amcor PLC (NYSE:AMCR)
Average Upside Potential as of July 7: 19.21%
Number of Hedge Fund Holders: 40
Amcor PLC (NYSE:AMCR) is one of the top 10 materials stocks to buy according to analysts. On July 2, 2025, Jefferies Financial Group initiated coverage on Amcor with a “Buy” rating and set a price target of $12.00. Jefferies cited a “compelling risk-reward” profile for the global packaging company.
The firm highlighted “good earnings momentum from Berry Plastics (BERY) synergies,” stemming from Amcor’s acquisition of Berry Global on April 30, 2025. Jefferies expects these “synergies” to enhance earnings growth. The firm also emphasized Amcor’s potential to improve volumes by reorienting its portfolio and divesting non-core assets that previously hindered growth performance. It noted that “strategic mergers and acquisitions represent a meaningful driver for value creation in the packaging sector,” particularly as the sector typically experiences low organic growth. Jefferies views Amcor’s merger with Berry Global favorably due to its timely execution, reasonable acquisition price, and potential for smooth integration.
Despite its strong market position and positive operational trends, Jefferies finds Amcor’s current valuation attractive, suggesting it is trading at a discount. They believe the stock is currently “undervalued.”
Amcor PLC (NYSE:AMCR), headquartered in Zurich, Switzerland, provides responsible packaging solutions for food, beverage, pharmaceutical, and personal care products. Operating across over 40 countries, it offers flexible and rigid packaging formats through brands like AmLite and AmPrima. The company stands out in the materials space for its scale, innovation in sustainable packaging, and strategic acquisitions, which have expanded its market reach and enhanced its earnings potential.
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