Is CRH a Good Investment Pick?

L1 Capital, an investment management firm, released its “L1 Capital International Fund” fourth quarter 2022 investor letter, a copy of the same can be downloaded here. In the fourth quarter, the L1 Capital International Fund returned 1.7% compared to its benchmark which had a 4.4% return for the same period. Spare some time to check the fund’s top 5 holdings to have a clue about their top bets for 2022.

In its Q3 2022 investor letter, L1 Capital International Fund mentioned CRH plc (NYSE:CRH) and explained its insights for the company. Founded in 1970, CRH plc (NYSE:CRH) is a Dublin, Ireland-based building material company with a $33.5 billion market capitalization. CRH plc (NYSE:CRH) delivered a 13.35% return since the beginning of the year, while its 12-month returns are down by -6.93%. The stock closed at $45.10 per share on January 24, 2023.

Here is what L1 Capital International Fund has to say about CRH plc (NYSE:CRH) in its Q3 2022 investor letter:

“During the December 2022 Quarter over 50% of the Fund’s holdings’ share prices increased by more than 10% in local currency with a number of them increasing by more than 20%. Five companies positively contributed over 0.5% (in AUD) to the Fund’s returns for the quarter which includes CRH plc (NYSE:CRH).

The share price of our building materials companies, CRH and Eagle Materials, also recovered from oversold levels in the December 2022 quarter, increasing 23% and 24% respectively (in USD), with further increases in early 2023. Mastercard’s share price also increased over 20% in the December 2022 Quarter.

During the December 2022 Quarter we took advantage of a strong recovery in share prices to further reduce our exposure to the U.S. housing market. We remain confident in the longer-term outlook for the building products companies we have invested in. That said, the rapid and substantial increase in mortgage rates will inevitably have a meaningfully negative impact on U.S. housing activity. Commercial activity remains robust and Infrastructure activity is expected to strengthen off a high base in 2023. We have therefore been selective in which sector investments we have retained, divesting Louisiana Pacific while continuing our investments in Eagle Materials and CRH.”

Our calculations show that CRH plc (NYSE:CRH) fell short and didn’t make it on our list of the 30 Most Popular Stocks Among Hedge Funds. CRH plc (NYSE:CRH) was in 5 hedge fund portfolios at the end of the second quarter of 2022, compared to 12 funds in the previous quarter. CRH plc (NYSE:CRH) delivered a 26.97% return in the past 3 months.

In September 2022, we also shared another hedge fund’s views on CRH plc (NYSE:CRH) in another article. You can find other investor letters from hedge funds and prominent investors on our hedge fund investor letters Q4 2022 page.

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