Increased Demand Lifted Atlas Energy Solutions (AESI) in Q1

ClearBridge Investments, an investment management company, released its “ClearBridge Small Cap Value Strategy” first quarter 2024 investor letter. A copy of the letter can be downloaded here. The firm focuses on companies with strong balance sheets and attractive cash flows with compelling valuations rather than following market trends. The strategy outperformed the benchmark Russell 2000 Value Index in the first quarter and generated gains across 11 sectors in which it was invested, on an absolute basis. Overall stock selection effects contributed to the performance on a relative basis. In addition, please check the fund’s top five holdings to know its best picks in 2024.

ClearBridge Small Cap Value Strategy highlighted stocks like Atlas Energy Solutions Inc. (NYSE:AESI), in the first quarter 2024 investor letter. Atlas Energy Solutions Inc. (NYSE:AESI) engages in the production, processing, and sale of mesh and sand that are used as a proppant during the well completion process in the Permian Basin. The one-month return of Atlas Energy Solutions Inc. (NYSE:AESI) was -22.46%, and its shares gained 8.59% of their value over the last 52 weeks. On June 18, 2024, Atlas Energy Solutions Inc. (NYSE:AESI) stock closed at $19.09 per share with a market capitalization of $2.904 billion.

ClearBridge Small Cap Value Strategy stated the following regarding Atlas Energy Solutions Inc. (NYSE:AESI) in its first quarter 2024 investor letter:

"Rising energy prices helped to support the performance of exploration and production (E&P) companies Magnolia Oil and Gas and Matador Resources and increased demand for energy equipment services, lifting companies like Atlas Energy Solutions Inc. (NYSE:AESI). We continue to have high conviction in Magnolia and Matador due to their strong and demonstrated ability to generate incremental returns on investment capital. Meanwhile Atlas continues to benefit from being the premier lowest-cost producer of materials needed by E&Ps in the Permian Basin. Building on its already strong distribution network and proprietary technology, Atlas’s recent announcement of its intention to acquire competitor Hi-Crush will make it the largest producer in the country of proppant, a material mixed with fracturing fluid for shale production, and solidify its position as a premier industry logistics provider. Expanding its product volume while maintaining its current fixed cost structure should support long-term returns."

Aerial view of oil rig in the Permian Basin, illustrating the expansive operations in West Texas and New Mexico.

Atlas Energy Solutions Inc. (NYSE:AESI) is not on our list of 31 Most Popular Stocks Among Hedge Funds. As per our database, 12 hedge fund portfolios held Atlas Energy Solutions Inc. (NYSE:AESI) at the end of the first quarter which was 9 in the previous quarter. In the first quarter, Atlas Energy Solutions Inc. (NYSE:AESI) generated total sales of $193 million. While we acknowledge the potential of Atlas Energy Solutions Inc. (NYSE:AESI) 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 Atlas Energy Solutions Inc. (NYSE:AESI) and shared the list of best dividend stocks that are undervalued and have just raised their payouts. 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.