Riverwater Partners' Micro Opportunities Strategy said LSB Industries declined about 28% in the second quarter of 2026 and was the portfolio's largest detractor. The firm originally owned the nitrogen products producer for its leverage to disrupted global nitrogen supply, a thesis that worked while Middle East conflict kept capacity offline. When peace negotiations progressed in mid-June, curtailed supply began returning to the market and the shares sold off. Riverwater believes the move to the downside is an overreaction and that LSB Industries will benefit from the disruption, adding that the market is missing the significant free cash flow the company will generate over the near and mid-term.
Lsb Industries IncFund manager calls selloff an overreaction, citing significant free cash flow generation.