Artisan Partners, a high value-added investment management firm, published its ‘Artisan International Value Fund’ fourth quarter 2021 investor letter – a copy of which can be downloaded here. A return of 4.38% was recorded by its Investor Class: ARTKX, 4.44% by its Advisor Class: APDKX, and 4.45% by its Institutional Class: APHKX for the fourth quarter of 2021, all outperforming the MSCI EAFE Index that delivered a 2.69% return and the MSCI All Country World ex USA Index that gained 1.82% for the same period. Spare some time to check the fund’s top 5 holdings to have a clue about their top bets for 2022.
Artisan International Value Fund, in its Q4 2021 investor letter, mentioned Alibaba Group Holding Limited (NYSE: BABA) and discussed its stance on the firm. Alibaba Group Holding Limited is a Hangzhou, China-based e-commerce company with a $340.3 billion market capitalization. BABA delivered a 5.70% return since the beginning of the year, while its 12-month returns are down by -53.64%. The stock closed at $125.56 per share on February 16, 2022.
Here is what Artisan International Value Fund has to say about Alibaba Group Holding Limited in its Q4 2021 investor letter:
“Alibaba has been a rollercoaster of an investment. Recall that we initially purchased Alibaba’s shares during the March 2020 selloff, sold our entire position in Q4 2020, then proceeded to rebuild a position in mid-2021. Our original investment thesis in March 2020 was that the company’s core e-commerce business was undervalued at 15X normalized earnings when other valuable businesses were considered, including Alicloud and Ant. The stock appreciated rapidly through Q3 2020 due to a resilient core commerce business and market excitement around the Ant IPO. However, in Q4 2020, regulators called off the Ant IPO, and in December the Chinese government launched an anti-monopoly investigation into Alibaba. At the time, we thought the stock price selloff did not fully reflect the anti-monopoly headwinds. We expected slowing top-line growth and flattish earnings in 2021, given increased regulatory scrutiny and the company’s weakened ability to compete aggressively with peers. Hence, we sold our entire position at a considerable gain.
We revisited the stock in mid-2021, after a 25% decline. Since our reentry into the stock, the business has faced ongoing regulatory, macroeconomic and competitive headwinds. What we considered a
sober initial forecast unfortunately turned out to be an underestimation of the regulatory scrutiny’s severity and its impact on competitive dynamics…” (Click here to see the full text)
Pixabay/Public Domain
Our calculations show that Alibaba Group Holding Limited (NYSE: BABA) ranks 13th on our list of the 30 Most Popular Stocks Among Hedge Funds. BABA was in 115 hedge fund portfolios at the end of the third quarter of 2021, compared to 146 funds in the previous quarter. Alibaba Group Holding Limited (NYSE: BABA) delivered a -22.29% return in the past 3 months.
In January 2022, we also shared another hedge fund’s views on BABA in another article. You can find other letters from hedge funds and prominent investors on our hedge fund investor letters 2021 Q4 page.
Disclosure: None. This article is originally published at Insider Monkey.
