Yahoo Finance Should You be Confident in the Long-Term Outlook of Air Products (APD)?
The London Company, an investment management company, released “The London Company Large Cap Strategy” first quarter 2024 investor letter. A copy of the same can be downloaded here. During 1Q, U.S. stocks made significant gains due to steady economic growth, decreasing inflation, and a slightly weaker labor market, increasing the likelihood of a soft landing. The fund gained 8.3% (8.2%, net) during the quarter compared to a 10.3% rise in the Russell 1000 Index. In addition, you can check the top 5 holdings of the fund to know its best picks in 2024.
The London Company Large Cap Strategy featured stocks like Air Products and Chemicals, Inc. (NYSE:APD) in the first quarter 2024 investor letter. Headquartered in Allentown, Pennsylvania, Air Products and Chemicals, Inc. (NYSE:APD) provides atmospheric gases, process and specialty gases, equipment, and related services. On May 2, 2024, Air Products and Chemicals, Inc. (NYSE:APD) stock closed at $243.69 per share. One-month return of Air Products and Chemicals, Inc. (NYSE:APD) was 2.10%, and its shares lost 17.87% of their value over the last 52 weeks. Air Products and Chemicals, Inc. (NYSE:APD) has a market capitalization of $54.174 billion.
The London Company Large Cap Strategy stated the following regarding Air Products and Chemicals, Inc. (NYSE:APD) in its first quarter 2024 investor letter:
"Air Products and Chemicals, Inc. (NYSE:APD) - Stock weakness continued in 1Q as slower industrial production in the China and semis markets is weighing on the base business. APD's multiple compressed significantly in past months to 19.5x PE (vs. close peer Linde {LND) at 30.5x) which points to investor skepticism in both management's ability to execute competitively in the core business and in the capital allocation strategy focused on clean energy megaprojects. In Q1, we spoke with the CEO and he is prioritizing the restoration of investor trust while also protecting APD's long-term strategy. We believe the stock is positioned to both rate as APD delivers consistent execution in the base business, and compound over time as offtake agreements offer tangible return for megaprojects.
Increased: Air Products (APD) - Addition follows recent weakness reflecting headwinds from higher inflationary costs and the associated impact potential on expected returns from some of APD's largest projects. Fundamentally, APD is in a strong position to capitalize on the clean energy revolution due to their scale, experience, technology, and customer relationships. Management has shown they will allocate capital efficiently and effectively by walking away from deals that do not meet return thresholds, while taking advantage of government policies, tax credits, and favorable green bond prices. We remain confident in the long-term outlook, and a recent large share purchase by the CEO is a strong sign of conviction."
A line of workers in a refinery wearing protective suits and masks, overseeing the production process of specialty gases.
Air Products and Chemicals, Inc. (NYSE:APD) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 42 hedge fund portfolios held Air Products and Chemicals, Inc. (NYSE:APD) at the end of the fourth quarter which was 43 in the previous quarter.
We previously discussed Air Products and Chemicals, Inc. (NYSE:APD) in another article, where we shared the list of best US chemical stocks to invest in. In addition, please check out our hedge fund investor letters Q1 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.
