Research from Water Tower Research, Water Tower Research

Water Tower Research

Water Tower Research is a leading equity research firm that provides research on micro, small and mid cap companies.

Water Tower Research was founded by Wall Street veterans after witnessing a fundamental shift in the investment research industry with the result being a declining knowledge base among investors, a lack of awareness and a shrinking pool of fundamental research being conducted on companies across the small-cap and micro-cap spectrum. The same issues are now increasingly occurring in the mid-cap space. This sea change within the investment community is impacting not only the companies themselves but also current shareholders and potential investors. With significantly less active sell-side sponsorship by Wall Street, a substantial information gap has developed between companies and various constituents in the financial community. The net result is fewer channels for insight and information to flow between companies and investors.

Research from Water Tower Research

Equity Research Firm

Thematic (Sector/Industry)

United states Materials / Thematic (Sector/Industry)

<ul><li>WTR-CMI keeping pace with broad markets. YTD, the S&amp;P 500 has appreciated 18%, compared with the 9.5% appreciation for the broader Russell 2000, while our WTR-CMI Index has improved 8.4%, held back primarily by lithium stocks, which are off anywhere from 37% for ALB to 68% for PLL.</li><li>Two companies in our index, RYAM and ECL, have outperformed even the tech-heavy S&amp;P 500, coming off a challenging 2023.</li><li>Unfortunately, with both lithium and ag markets still under pressure, we do not expect companies in our sector to outperform the broader markets in 2H24, although individual stock outperformance may continue.</li></ul>

WTR-CMI keeping pace with broad markets. YTD, the S&amp;P 500 has appreciated 18%, compared with the 9.5% appreciation for the broader Russell 2000, while our WTR-CMI Index has improved 8.4%, held back primarily by lithium stocks, which are off anywhere from 37% for ALB to 68% for PLL.Two companies in our index, RYAM and ECL, have outperformed even the tech-heavy S&amp;P 500, coming off a challenging 2023.Unfortunately, with both lithium and ag markets still under pressure, we do not expect companies in our sector to outperform the broader markets in 2H24, although individual stock outperformance may continue.

Mat-Chem Notes Caution - Canada Rail Strike, Weakening Ag-Chem Market, and Slower EV Adoption