L1 Capital International Sells Eagle Materials (EXP). Here's the Reason
- Last update: 12/13/2025
- 2 min read
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- Business
L1 Capital, an investment management company, shared its third-quarter 2025 update for the L1 Capital International Fund (unhedged). During this period, the fund achieved a 2.6% return, compared with 6.1% for the MSCI World Net Total Return Index in AUD. The funds top holdings for 2025 were also highlighted.
Among the stocks discussed, Eagle Materials Inc. (NYSE:EXP), a supplier of heavy and light construction materials, was a notable focus. The company saw a one-month return of 11.41%, while its shares declined 17.64% over the past year. As of December 11, 2025, Eagle Materials shares were valued at $225.12 each, with a market capitalization of $7.305 billion.
The fund explained its decision to divest from Eagle Materials and Veolia in the letter:
"Eagle Materials has been a long-term holding and one of the top contributors to the Funds returns since inception. The company primarily produces cement and wallboard in the U.S. While it is well-managed with strong reserves and competitive advantages, we are cautious about the residential housing cycle. High house prices and mortgage rates have reduced affordability, and consumer confidence remains low. Housing completions may decline if new housing starts stay under pressure, which could affect wallboard demand and pricing. Cement prices have also been muted. After a recent share price increase, we found other investment opportunities more attractive. Eagle Materials remains on our Bench."
Regarding investor sentiment, Eagle Materials was not among the 30 most popular stocks held by hedge funds. As of Q3 2025, 38 hedge fund portfolios included the stock, up slightly from 36 in the previous quarter. In Q2 of fiscal 2026, the company reported $639 million in revenue, a 2% increase year-over-year. While it remains a viable investment, the fund sees potentially greater opportunities in certain AI stocks.
For more information, readers are encouraged to explore additional investor letters from Q3 2025 and analyses from other leading funds.
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Zoe Harrison is a journalist focused on human interest stories and social issues. She excels at crafting compelling narratives and investigative features.
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