The alpha Brief: Insights on Quant Investing and the alpha Brief Portfolio (aBP)

I am downgrading Albemarle from a STRONG BUY to a HOLD. The balance sheet and demand evidence are better, but current valuation already discounts a healthy mid-cycle outcome while lithium-price downside remains severe. Q2 2026 net sales rose 31% to $1.743Bn, adjusted EBITDA increased 155% to $858Mn, and adjusted EPS of $3.75 beat the $3.20 consensus by 17%.

A strong investment thesis should become stronger when new evidence arrives. This week, an AI-connectivity company translated product momentum into earnings leverage, a defense contractor expanded backlog visibility through a major missile award, and a gold miner combined lower costs with record profitability and aggressive buybacks. The common thread wasn't the share-price reaction. It was the growing body of evidence behind each long-term investment case.

Not all corporate announcements deserve the same weight. This week, one company extended a production platform, another converted proven technology into international demand, and a third introduced an ambitious AI architecture that still needs real-world deployment. The question isn't which story sounds biggest. It's how much proof already exists and how much still depends on execution.

Fresh catalysts are putting three very different companies back on our radar. Tesla has reported stronger than expected Q3 vehicle deliveries and record energy storage deployments, while Manulife has completed another transaction aimed at reducing legacy insurance risk and Constellium has strengthened its long term aerospace exposure through a new 10 year Airbus agreement.

Power generation, grid equipment and critical minerals are becoming increasingly interconnected. Reliable electricity cannot be delivered without generation capacity, transmission infrastructure and the raw materials required to build both.

I am downgrading SSRM from a STRONG BUY to BUY. The balance sheet and capital returns strengthened. But the operating margin of safety weakened because costs and second-half execution now carry more weight.

The original thesis strengthened as Mt. Holly completed its restart, Grundartangi returned close to full production, and Jamalco’s new turbine came online.

Newmont remains a Strong Buy in my view as the market continues to focus on a temporary 2026 production slowdown while ignoring the company's exceptional cash generation, net-cash balance sheet, and aggressive share repurchase program. With Ahafo North ramping up, major projects advancing, and the stock trading at just 13x forward earnings, investors appear to be valuing Newmont on trough-year results rather than its improving 2027 earnings and production outlook

I am maintaining my Strong Buy rating on Centerra Gold as strong Q2 results reinforce the company's ability to generate cash, fund growth, and return capital simultaneously. With rising production guidance, a debt-free balance sheet, over $1 Bn of liquidity, and multiple catalysts including Thompson Creek, Goldfield, Kemess, and Mount Milligan, I believe the market continues to undervalue Centerra's long-term growth potential.

Albemarle owns advantaged lithium capacity and high-margin specialty chemistries essential to EV and AI battery stacks. I see durable cash generation from expansions and disciplined capital allocation—hence Strong Buy

Sterling is strategically positioned in rapidly expanding sectors particularly data centers, semiconductors, and e‑commerce infrastructure driving outsized revenue growth and long-term demand visibility.

We rate this company a Strong Buy because the earnings setup has improved quickly, helped by stronger aluminium prices, firmer regional premiums, and visible operational recovery

SSR Mining ended 2025 with $471Mn in operating cash flow and $241.6Mn in free cash flow. All this while its most scrutinised asset isn’t fully operational. And I think the market hasn’t caught up to that yet.

Centerra Gold is given a strong buy rating. It trades at a significant discount on forward P/E and EV/EBITDA compared to sector medians. Backed by a strong balance sheet, the company is driving growth through self-funded cash flows and active share buybacks. While geopolitical and operational risks remain, Centerra’s deep value and disciplined capital allocation make it a compelling investment opportunity in the mining sector.

Newmont is a strong buy due to its record 2025 financials. Despite a planned production dip, the company is effectively managing costs and leveraging growth from projects. Currently mispriced with a high ROE relative to peers, Newmont is prioritizing shareholder value through a $6 billion share repurchase program and increased dividends. Its diversified global operations and robust balance sheet make it a wise investment, even without further gold price increases.