Lakehouse Capital, a Sydney-based investment manager, released its “Lakehouse Global Growth Fund” February 2025 investor letter. A copy of the letter can be downloaded here. February was a volatile month for global equities due to the deluge of Trump headlines. However, the portfolio’s holding companies continue to press their advantages and execute on their growth opportunities. The Fund returned -1.0% net of fees and expenses for the month compared to -0.3% for its benchmark. Since its inception in December 2017, the Fund has returned 250.6%, compared to 136.1% for its benchmark, the MSCI All Country World Index, Net Total Returns (AUD). In addition, please check the fund’s top five holdings to know its best picks in 2025.
In its February 2025 investor letter, Lakehouse Global Growth Fund emphasized stocks such as MercadoLibre, Inc. (NASDAQ:MELI). MercadoLibre, Inc. (NASDAQ:MELI) is an online commerce platform that operates Mercado Libre Marketplace and Mercado Pago FinTech platforms. The one-month return of MercadoLibre, Inc. (NASDAQ:MELI) was -8.24%, and its shares gained 22.15% of their value over the last 52 weeks. On April 8, 2025, MercadoLibre, Inc. (NASDAQ:MELI) stock closed at $1,826.11 per share with a market capitalization of $92.579 billion.
Lakehouse Global Growth Fund stated the following regarding MercadoLibre, Inc. (NASDAQ:MELI) in its February 2025 investor letter:
“The Funds largest position, e-commerce leader MercadoLibre, Inc. (NASDAQ:MELI), delivered another impressive quarterly result, combining robust growth with improving profitability. Net revenue grew 37% year-on-year in U.S. dollar terms to $6.1 billion while operating margins climbed to 13.5%, which was particularly pleasing given the company remains firmly in reinvestment mode. Key operational metrics for its marketplace underscored this strength, with items sold increasing 27%, unique buyers climbing 24% to a new high of 67 million and items per buyer increasing to 7.8. Importantly, the company continues to gain incremental market share in its primary regions, namely that of Brazil and Mexico.
The outperformance of the company’s advertising business also continues to be bright spot, growing 40% plus year-on-year in USD terms. As of today, the advertising business still only represents 2.1% of GMV, which is well below the level of more mature e-commerce peers globally and suggests there is still plenty of runway to grow the ads business. This not only provides another attractive growth vector but also a meaningful lever to improve profitability over time given the higher-margin nature of advertising revenue.”
A customer using their phone to access an online commerce platform.
MercadoLibre, Inc. (NASDAQ:MELI) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 96 hedge fund portfolios held MercadoLibre, Inc. (NASDAQ:MELI) at the end of the fourth quarter which was 87 in the previous quarter. While we acknowledge the potential of MercadoLibre, Inc. (NASDAQ:MELI) 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.
We covered MercadoLibre, Inc. (NASDAQ:MELI) in another article, where we shared the list of top stocks to buy according to Think Investments. In addition, please check out our hedge fund investor letters Q1 2025 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.