Billionaire Jorge Paulo Lemann’s Top 5 Stock Picks

1. Carvana Co. (NYSE: CVNA)

Shares of Carvana Co. (NYSE: CVNA) surged more than 800% in the last twelve months amid investors increased confidence in its e-commerce platform of buying and selling used cars in the United States. It is the largest stock holding of 3G Capital. The firm increased its stake in Carvana by 33% in the December quarter to 20.11% of the overall portfolio.

ShawSpring Partners, a value-focused investment firm, claimed in their investor letter that Carvana’s stock price is overvalued. Here is what ShawSpring Partners stated:

“We made the decision to exit our investment in Carvana. Over our two-year holding period, we generated an internal rate of return of 114%. Our exit decision is unrelated to a change in our assessment of Carvana’s business quality, long-term opportunity, or management team. Instead, our rationale was based on our internal estimate of Carvana’s valuation, and our forecast for prospective returns. We continue to believe in the strength of Carvana’s vertically-integrated business model, and the superior customer proposition Carvana provides to used-car buyers. While we have no doubts that Carvana will remain a great business, we believe that at Carvana’s current valuation, it makes sense to shift our attention towards other equally fantastic businesses which have long growth runways less appreciated by the market. We will continue to follow the company’s progress closely and expect to take advantage of any dislocations that may cause Carvana’s expected return to meet our high hurdle rate for re-investment.”

You can also take a peek at Billionaire Ken Griffin’s Top 10 Stock Picks and Billionaire Nicholas Pritzker’s Tao Capital’s Best Stock Ideas.

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