In this article, we discuss the top 5 stock picks of billionaire Jorge Paulo Lemann’s 3G Capital as of the end of third quarter last year. If you want our detailed analysis of the hedge fund’s performance, go to Was Billionaire Jorge Paulo Lemann’s 3G Capital Right About These 10 Stocks?
5. Docebo Inc. (NASDAQ:DCBO)
3G Capital’s Stake Value: $29,177,000
Performance of the stock over the past 12 months: -57%
Docebo Inc. (NASDAQ:DCBO), a company offering a cloud-based learning platform, is one of the top stocks from Jorge Paulo Lemann’s Q3 portfolio. 3G capital increased its stake in Docebo Inc. (NASDAQ:DCBO) by 4.35% in the third quarter, owning 120,000 shares in the company, valued at $29.1 million, representing 6.34% of the firm’s investment portfolio.
4. TaskUs, Inc. (NASDAQ:TASK)
3G Capital’s Stake Value: $46,459,000
Performance of the stock over the past 12 months as of November 22: -56%
TaskUs, Inc. (NASDAQ:TASK) is an outsourcing company handling content creation, customer experience consulting, and business process optimization services for clients including Meta Platforms, Inc. (NASDAQ:FB) and DoorDash, Inc. (NYSE:DASH). Lemann holds a $46.45 million stake in TaskUs, Inc. (NASDAQ:TASK), which accounts for 10.1% of his Q3 investments. 3G Capital increased its holding in TaskUs, Inc. (NASDAQ:TASK) by 250% in Q3, as compared to the prior quarter.
Here is what Carillon Tower Advisers has to say about TaskUs, Inc. (NASDAQ:TASK) in its Q3 2021 investor letter:
“TaskUs provides outsourced digital services and next-generation customer experience to innovative and disruptive technology companies looking to protect and grow their brands. The firm, which recently went public, is a key partner to enterprises specifically in the fast growing ecommerce, social media, and food delivery industries. Investors under-appreciated the business model of the company at the time of the initial public offering, but the company has since reported results that were highly encouraging and showed revenue growth acceleration as it solves some of the more mundane and labor intensive issues for many emerging tech companies.”
3. Carvana Co. (NYSE:CVNA)
3G Capital’s Stake Value: $88,954,000
Performance of the stock over the past 12 months as of November 22: -97%
Carvana Co. (NYSE:CVNA), an online used car retailer, accounts for 19.34% of Lemann’s Q3 investments, with his investment firm holding an $88.9 million position in the company. Zachary Sternberg and Benjamin Stein’s Spruce House Investment Management is one of the leading stakeholders of Carvana Co. (NYSE:CVNA), with 3.75 million shares worth $1.13 billion.
Here is what Steel City Capital has to say about Carvana Co. (NYSE:CVNA) in their Q1 2021 investor letter:
“Carvana’s (CVNA) 4Q’20 results weren’t particularly great. EBITDA was negative ($70) million, a stark turnaround on a sequential basis from a first-ever EBITDA profit of $21 million in 3Q’20. The culprit was a steep drop off in retail unit GPU ($1,265 vs. $1,857) and wholesale unit GPU ($358 vs. $1,113) as some of the COVID-driven aberrations in the used car market began to abate.
The company’s presentation of EBITDA (calculated “bottom up”) is dubious, as it commingles non-operating items including mark-to-market changes in its retained securitization portfolio. With the exception of 1Q’20, when ABS markets were going haywire, this line item provided a tailwind throughout 2020, including a gain of $5 million in 4Q’20. Also on the non-operating self-help front, management released a reserve for vehicle service contract cancellations in 4Q’20, adding another $7 million to EBITDA, and boosting “Other” GPU by $96…” (Click here to see the full text)
2. Sea Limited (NYSE:SE)
3G Capital’s Stake Value: $92,432,000
Performance of the stock over the past 12 months as of November 22: -82%
A global internet company offering digital entertainment, financial services, and e-commerce, Sea Limited (NYSE:SE) is one of Jorge Paulo Lemann’s top stock picks from the third quarter, with 3G Capital holding a $92.4 million stake in the company, which accounts for 20.09% of the firm’s portfolio.
Here is what Tao Value has to say about Sea Limited (NYSE:SE) in its Q2 2021 investor letter:
“Sea continued to execute above expectation. The gaming business continued strong momentum, recording bookings of $1.1 billion, growing 117% y-o-y. The major franchise Free Fire showed no sign of slowing down in the established ASEAN & LatAm market and received positive reception from new markets like the US. On the e-commerce side, Shopee demonstrated early success in expanding to Brazil, by adopting a low-price category & gamification strategy. For 2021, Shopee is now the top downloaded e-commerce app in Brazil, almost 2x of the second-place local leader Mercado Libre (MELI). I also see the most promising development is in its FinTech business – SeaMoney, which more than doubled its revenue in Q1 2021 from the previous quarter! With online lending products rolling out, SeaMoney is poised to grow rapidly, becoming the 3rd growth curve for Sea.”
1. Bill.com Holdings, Inc. (NYSE:BILL)
3G Capital’s Stake Value: $96,102,000
Performance of the stock over the past 12 months as of November 22: -62%
Bill.com Holdings, Inc. (NYSE:BILL) is a software company that automates financial operations for SMBs. As of the third quarter, Bill.com Holdings, Inc. (NYSE:BILL) is the largest holding in billionaire Jorge Paulo Lemann’s portfolio, with his investment firm owning 360,000 shares in Bill.com Holdings, Inc. (NYSE:BILL), worth $96.1 million, representing 20.89% of the firm’s total investments.
You can also take a look at Top 10 Stocks to Invest in According to Alan Fournier’s Pennant Capital and Top 10 Stock Picks of Brad Farber’s Atika Capital.
