10 Best ASX Stocks to Buy According to Hedge Funds

1. Rio Tinto Group (NYSE:RIO)

Number of Hedge Fund Holdings: 30

Rio Tinto Group (NYSE:RIO) is a global mining and metals company with a focus on finding, mining, and processing mineral resources. The company’s operations span various commodities, including aluminum, copper, diamonds, gold, iron ore, and more recently, lithium.

Rio Tinto Group’s (NYSE:RIO) recent acquisition of Arcadium Lithium marks a significant step in the company’s strategy to become a leading player in the lithium market. Arcadium is a global, vertically integrated lithium chemical producer with a diverse portfolio of Tier-1 assets, including large, low-cost lithium brine operations in Argentina and hard rock mines in Quebec, Canada. By incorporating Arcadium into its portfolio, Rio Tinto Group (NYSE:RIO) aims to position itself to meet the rising global demand for lithium, a key component in electric vehicles and energy storage systems.

Additionally, Arcadium’s expertise in Direct Lithium Extraction (DLE) technology, particularly through its ILiAD initiative, aligns with Rio Tinto Group’s (NYSE:RIO) ongoing efforts in technology development. DLE technology provides a more sustainable and efficient method of lithium extraction, requiring less energy, water, and land while achieving higher recovery rates. This technology is essential for meeting the environmental and sustainability standards that are becoming increasingly important to both consumers and regulatory authorities.

While we acknowledge the potential of Rio Tinto Group (NYSE:RIO) to grow, 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 more promising than RIO but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.

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