5 Best ADR Stocks To Buy Now

3. Coupang, Inc. (NYSE:CPNG)

Number of Hedge Fund Shareholders: 36

Country of Origin: South Korea

Shares of Coupang, Inc. (NYSE:CPNG), which operates the leading e-commerce platform in South Korea, have slumped by 37% this year despite the company not only continuing to grow at a rapid rate, but also posting a surprising profit in its latest quarter. The company’s sales rose by 27% to $5.1 billion during Q3, while it swung to a profit of $91 million during the quarter compared to a $324 million loss during Q3 of 2021. Its gross margin rose by 800 basis points year-over-year to 24.2%. The company is still cash flow negative, but with sales and margins growing rapidly, it shouldn’t be long before that changes.

After a steep drop in smart money ownership of Coupang, Inc. (NYSE:CPNG) during Q4, there was a 34% rebound in the first quarter of this year, which held firm during the second quarter, followed by a slight dip in the third quarter. Several funds have aggressive 13F exposure to CPNG, including Lee Ainslie’s Maverick Capital (30.5%), Neil Mehta’s Greenoaks Capital (62.8%), and Stanley Druckenmiller’s Duquesne Capital (18.4%).

Baron Funds was also building more exposure to Coupang, Inc. (NYSE:CPNG) during Q2 and shared its reasoning for doing so in its Q2 2022 investor letter:

“During the quarter, we also added to our position in the leading Korean e-commerce player, Coupang, Inc. (NYSE:CPNG), taking advantage of the stock’s volatility. While the stock sold off, the business remains robust, growing revenues by 32% in the most recent quarter (year-over-year in constant currency) while gaining market share (the industry grew 8%) and reaching profitability in its product commerce segment three quarters ahead of plan.”