Patient Capital Management, a value investing firm, released its “Patient Capital Opportunity Equity Strategy” first quarter 2025 investor letter. A copy of the letter can be downloaded here. 2025 got out to a solid start with the market hitting all-time highs in mid-February. However, a dramatic reversal pushed the S&P 500 down 8.7%, closing the quarter down 4.3%. During the quarter, the strategy returned -9.5% net of fees compared to the S&P 500’s -4.3% return. According to a three-factor performance attribution model, allocation and interaction effects contributed positively to the portfolio’s performance, which were partially offset by selection effects. In addition, you can check the fund’s top 5 holdings to know its best picks in 2025.
In its first-quarter 2025 investor letter, Patient Capital Opportunity Equity Strategy highlighted stocks such as JD.com, Inc. (NASDAQ:JD). Headquartered in Beijing, the People’s Republic of China, JD.com, Inc. (NASDAQ:JD) is a supply chain-based technology and service provider. The one-month return of JD.com, Inc. (NASDAQ:JD) was -21.75%, and its shares gained 17.38% of their value over the last 52 weeks. On April 23, 2025, JD.com, Inc. (NASDAQ:JD) stock closed at $33.56 per share with a market capitalization of $49.491 billion.
Patient Capital Opportunity Equity Strategy stated the following regarding JD.com, Inc. (NASDAQ:JD) in its Q1 2025 investor letter:
“We enteredJD.com, Inc. (NASDAQ:JD), a leading e-commerce company in China. Unlike competitors in the space, JD focuses on consumer electronics and home appliances supporting strong differentiation and defendable margins. The company has been on a year-long organizational restructuring following its ill-advised venture into the low-cost competitive space where it lacked an advantage. Not only will the company benefit from returning to their roots, but the government has rolled out a trade-in rebate policy for home appliances and consumer electronics further supporting demand. At the same time, the company has been disciplined in terms of spending, creating a margin expansion story as the topline demand improves. With the Chinese government increasing their focus on reigniting consumer consumption, we believe JD is well positioned to benefit from increased demand and improving margins. At the same time, the company is returning cash to shareholders via a dividend yield of 3.0%, and a buyback program that has seen 8.1% repurchased in 2024. While the risk of a trade war with China is an overhang on the stock, the company generates the majority of their revenues domestically.”
An international e-commerce package with a variety of products being sent to customers.
JD.com, Inc. (NASDAQ:JD) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 78 hedge fund portfolios held JD.com, Inc. (NASDAQ:JD) at the end of the fourth quarter, compared to 75 in the third quarter. In the fourth quarter of 2024, JD.com, Inc.’s (NASDAQ:JD) revenue grew 13% year-on-year to RMB347 billion. While we acknowledge the potential of JD.com, Inc. (NASDAQ:JD) 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 covered JD.com, Inc. (NASDAQ:JD) and shared the list of cheap NASDAQ stocks to buy according to hedge funds. 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.