Investment management company First Pacific Advisors recently released its “FPA Queens Road Small Cap Value Fund” third quarter 2024 investor letter. A copy of the letter can be downloaded here. In the third quarter, the fund returned 7.48% compared to a 10.15% return for the Russell 2000 Value Index. Year-to-date, the fund returned 8.1% compared to a 9.22% return for the index. In addition, you can check the fund’s top 5 holdings to determine its best picks for 2024.
FPA Queens Road Small Cap Value Fund highlighted stocks like Arcadium Lithium plc (NYSE:ALTM) in the third quarter 2024 investor letter. Arcadium Lithium plc (NYSE:ALTM) produces lithium chemical products. The one-month return of Arcadium Lithium plc (NYSE:ALTM) was -3.25%, and its shares gained 100.75% of their value over the last three months. On November 8, 2024, Arcadium Lithium plc (NYSE:ALTM) stock closed at $5.36 per share with a market capitalization of $5.765 billion.
FPA Queens Road Small Cap Value Fund stated the following regarding Arcadium Lithium plc (NYSE:ALTM) in its Q3 2024 investor letter:
“Arcadium Lithium plc (NYSE:ALTM) is an integrated, low-cost, well-managed lithium producer formed by the merger of Livent, which the Fund owned, and Allkem in Australia. The merger was completed at the beginning of this year and we received, and decided to hold, shares of Arcadium.25 The share price has declined because of volatile lithium prices that collapsed from bubbly levels at the beginning of 2023.26 Estimates for electric vehicle production are slowing and capacity got ahead of demand; the industry is now waiting for a supply response. On October 03, 2024, post quarter end, Arcadium announced that they are getting bought by Rio Tinto for $5.85 per share.
Arcadium is an unusual investment for us. We normally avoid the commodity and materials sectors, and have kept our position in Arcadium small. But we believe Arcadium has a unique position in an industry with a strong long-term outlook. The company has low-cost production assets, is virtually debt-free, and has considerable capacity additions planned near-term.”
A close-up of an open-pit mine in the Carolina Lithium Project.
Arcadium Lithium plc (NYSE:ALTM) is not on our list of 31 Most Popular Stocks Among Hedge Funds. As per our database, 19 hedge fund portfolios held Arcadium Lithium plc (NYSE:ALTM) at the end of the second quarter which was 21 in the previous quarter. While we acknowledge the potential of Arcadium Lithium plc (NYSE:ALTM) 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 cheapest AI stock.
In another article, we discussed Arcadium Lithium plc (NYSE:ALTM) and shared the list of worst specialty chemical stocks to buy according to short sellers. In Q2 2024, investor letter, FPA Queens Road Small Cap Value Fund shared its optimistic views on Arcadium Lithium plc (NYSE:ALTM). In addition, please check out our hedge fund investor letters Q3 2024 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.