Diamond Hill Remains Bullish on United States Lime & Minerals (USLM) Despite Margin Headwinds

Diamond Hill Remains Bullish on United States Lime & Minerals (USLM) Despite Margin Headwinds

Thu, September 3, 2026 at 6:40 PM GMT+3 3 min read

Diamond Hill Capital, a First Eagle Investment Management company, issued its Q2 2026 investor letter for its "Small Cap Strategy". The letter can be downloaded here. The strategy returned 24.01% in the second quarter, outperforming the Russell 2000 Index's 21.49% return. Performance was positively affected by stock selection in health care and industrials, while the Fund's underweight position in information technology was the largest relative detractor as AI-related companies drove market gains. Small-cap equities benefited from strong earnings, resilient economic conditions, and easing geopolitical concerns, with technology leading sector performance while energy declined alongside lower oil prices. Despite the market's focus on AI, the Fund's strongest contributors came from businesses outside the theme, particularly in health care, defense-oriented companies, and tangible-asset industries. Looking ahead, the Fund remains focused on resilient, underfollowed companies tied to infrastructure, defense modernization, and essential industries where disciplined capital allocation and long-term demand can support value creation. Also, check the fund's top five holdings to see its best picks in 2026.

In its second-quarter 2026 investor letter, Diamond Hill Capital Small Cap Strategy highlighted United States Lime & Minerals, Inc. (NASDAQ:USLM). United States Lime & Minerals, Inc. (NASDAQ:USLM) manufactures and supplies lime and limestone products in the United States. On September 02, 2026, United States Lime & Minerals, Inc. (NASDAQ:USLM) closed at $115.05 per share. Over the past month, United States Lime & Minerals, Inc. (NASDAQ:USLM) declined 0.94%, and its shares lost 4.79% over the past 52 weeks. United States Lime & Minerals, Inc. (NASDAQ:USLM) has a market capitalization of $3.3 billion.

Diamond Hill Capital Small Cap Strategy stated the following regarding United States Lime & Minerals, Inc. (NASDAQ:USLM) in its Q2 2026 investor letter:

"United States Lime & Minerals, Inc. (NASDAQ:USLM), a producer and supplier of limestone products, underperformed as several near-term headwinds—weather disruptions, labor shortages and higher fuel costs—pressured demand and margins. Despite these challenges, the company's scarce limestone reserves in Texas continue to support strong pricing power, and we maintain a constructive long-term view for the business."

United States Lime & Minerals, Inc. (NASDAQ:USLM) is not on our list of the 40 Most Popular Stocks Among Hedge Funds. As per our database, 26 hedge fund portfolios held United States Lime & Minerals, Inc. (NASDAQ:USLM) at the end of the second quarter which was 24 in the previous quarter. While we acknowledge the potential of United States Lime & Minerals, Inc. (NASDAQ:USLM) as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

In another article, we covered United States Lime & Minerals, Inc. (NASDAQ:USLM) and shared best cement stocks to buy for the long term. In addition, please check out our hedge fund investor letters Q2 2026 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.