Rowan Street Capital, an investment management company, released its 2023 investor letter. A copy of the same can be downloaded here. The year 2023 proved to be a successful one for the fund as it recorded a net gain of +102.6%. In 2023, Meta Platforms (+194%), Spotify (+138%), Trade Desk (+60%), and Shopify (+124%) were the main contributors to the outperformance. In addition, you can check the top 5 holdings of the fund to know its best picks in 2023.
Rowan Street Capital featured stocks such as Shopify Inc. (NYSE:SHOP) in its 2023 annual investor letter. Headquartered in Ottawa, Canada, Shopify Inc. (NYSE:SHOP) provides a cloud-based commerce platform. On January 26, 2024, Shopify Inc. (NYSE:SHOP) stock closed at $81.55 per share. One-month return of Shopify Inc. (NYSE:SHOP) was 4.69%, and its shares gained 72.81% of their value over the last 52 weeks. Shopify Inc. (NYSE:SHOP) has a market capitalization of $104.731 billion.
Rowan Street Capital stated the following regarding Shopify Inc. (NYSE:SHOP) in its 2023 annual investor letter:
“Shopify Inc. (NYSE:SHOP) is an all-in-one e-commerce platform that empowers businesses of all sizes to build, manage, and grow their online stores. Founded in 2006, Shopify now holds a commanding >10% market share in US e-commerce.
The value of Shopify lies in its simplicity for merchants to easily start and scale their business, so much so that merchants fall in love with their solutions and never want to leave, no matter how big they get. They understand that as they grow and confront new challenges, Shopify will solve their problems so they can take their business to the next level. That is the power of Shopify’s flywheel.
We have owned Shopify’s stock since 2022. Our average cost basis is $60. Following our purchase, the stock hit a low of $26 in October 2022. Just 15 months following those lows, Shopify stock is now trading at $80 (a 200% rebound) as investors celebrated the decision to sell its capital intensive logistics business, which was largely expected to cost billions of dollars to build out — a move that enables Shopify to retain its original, asset-light business model. Additionally, while many tech companies struggled in the face of macroeconomic challenges, Shopify defied expectations by maintaining robust revenue growth in 2023. Revenue increased by 25% year-over-year in the most recent quarter, with gross profit growing by a healthy 36%. We are now sitting on a +35% unrealized gain on our position after owning the stock for almost 2 years. Not a bad return, but what a wild ride it has been. Just another example that volatility is the price of admission in this business.”
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Shopify Inc. (NYSE:SHOP) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 69 hedge fund portfolios held Shopify Inc. (NYSE:SHOP) at the end of third quarter which was 74 in the previous quarter.
We discussed Shopify Inc. (NYSE:SHOP) in another article and shared the list of stocks with at least 30% annual growth rates to consider for a growth stock portfolio. In addition, please check out our hedge fund investor letters Q4 2023 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.
