Patient Capital Management, a value investing firm, released its “Patient Capital Opportunity Equity Strategy” third quarter 2024 investor letter. A copy of the letter can be downloaded here. During the quarter, the strategy returned 5.58% net of fees compared to the S&P 500’s 5.89% return. According to a three-factor performance attribution model, allocation and selection effects contributed positively to the portfolio’s performance while interaction effects contributed negatively. In addition, you can check the fund’s top 5 holdings to determine its best picks for 2024.
Patient Capital Management highlighted stocks like Alibaba Group Holding Limited (NYSE:BABA), in the third quarter 2024 investor letter. Alibaba Group Holding Limited (NYSE:BABA) provides technology infrastructure and marketing reach. The one-month return of Alibaba Group Holding Limited (NYSE:BABA) was 12.93%, and its shares gained 22.45% of their value over the last 52 weeks. On October 16, 2024, Alibaba Group Holding Limited (NYSE:BABA) stock closed at $102.17 per share with a market capitalization of $239.354 billion.
Patient Capital Management stated the following regarding Alibaba Group Holding Limited (NYSE:BABA) in its Q3 2024 investor letter:
“Alibaba Group Holding Limited (NYSE:BABA) experienced a massive rebound gaining +47% in the quarter following the announced stimulus program from the Chinese government. As the unexpectedly strong government support was announced, shorts were reversed and any name exposed to China was off to the races. We have long liked Alibaba as the company has continued to trade at a significant discount to its sum-of-the-parts valuation. With most investors writing off Chinese companies entirely, you had an opportunity to invest in a high-quality business at rock bottom prices. Over that time, the company initiated both a dividend (0.9% Yield) and buyback program, repurchasing 9% of shares outstanding over the last twelve months. Despite the strong move in the quarter, the company trades at just 12.4x next-year’s earnings. We see potential for continued multiple expansion as the Chinese economy rebounds and the country becomes investable again.”
An e-commerce platform displaying a wide range of products to customers online.
Alibaba Group Holding Limited (NYSE:BABA) is in 23rd position on our list of 31 Most Popular Stocks Among Hedge Funds. As per our database, 91 hedge fund portfolios held Alibaba Group Holding Limited (NYSE:BABA) at the end of the second quarter which was 103 in the previous quarter. Alibaba Group Holding Limited’s (NYSE:BABA) consolidated revenue for fiscal first quarter of 2025 was RMB243.2 billion, a 4% rise from previous year’s same quarter and consolidated adjusted EBITDA decreased 1% year-over-year to RMB45 billion. While we acknowledge the potential of Alibaba Group Holding Limited (NYSE:BABA) as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is as promising as NVIDIA but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
In another article, we discussed Alibaba Group Holding Limited (NYSE:BABA) and shared Michael Burry’s top stock picks heading into 2025. Oakmark International Fund also benefitted from the rise of Alibaba Group Holding Limited (NYSE:BABA) in Q3 2024. In addition, please check out our hedge fund investor letters Q3 2024 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.