In this article, we will discuss the 5 best stocks to buy according to Brazilian Billionaire Jorge Paulo Lemann. If you want to skip our detailed analysis of Lemann’s history, investment philosophy, and hedge fund performance, go directly to the 10 best stocks to buy according to Brazilian billionaire Jorge Paulo Lemann.
5. Futu Holdings Limited (NASDAQ: FUTU)
Lemann’s Stake Value: $11,912,000
Percentage of Jorge Paulo Lemann’s 13F Portfolio: 4.42%
Number of Hedge Fund Holders: 26
Futu Holdings Limited (NASDAQ: FUTU) manages an online brokerage and wealth management platform. It was founded in 2007 and ranks fifth on the list of 10 best stocks to buy according to Brazilian billionaire Jorge Paulo Lemann. Futu Holdings shares have gained a whopping 334.52% over the last 12 months.
On July 13, Goldman Sachs analyst Shuo Yang initiated a coverage on Futu Holdings Limited (NASDAQ: FUTU) with a “Neutral” rating and price target of $158.27. On June 1, Futu Singapore Pte. Ltd., subsidiary of Futu Holdings Limited (NASDAQ: FUTU), obtained over 100K valuable clients, with user base broadening to over 220K in Singapore after its launch on March 8, 2021. More than 40% of paying clients exhibited interest in trading in the U.S. market. On May 19, Futu Holdings declared earnings for the first quarter of 2021. It reported earnings per share of $1.03, beating market predictions by $0.42. The revenue for the first three months of 2021 was over $283.56 million, beating the estimates by $65.52 million. In the first quarter of 2021 total number of paying clients increased to 789,652, up 231% YoY.
Futu Holdings Limited (NASDAQ: FUTU) is the latest addition in billionaire Jorge Paulo Lemann’s hedge fund portfolio, as 3G Capital bought 75,000 shares of the company, worth $11.91 million. In addition, hedge funds are loading up on Futu Holdings Limited (NASDAQ: FUTU), as Insider Monkey’s data shows that 26 hedge funds held stakes in the company in the first quarter of 2021, compared to 17 funds a quarter earlier.
Tao Value, in its first quarter 2021 investor letter, mentioned Futu Holdings Limited (NASDAQ: FUTU). Here is what the fund has to say about Futu Holdings Limited in its letter:
“Futu is a new “Opportunistic” position. It is an HK based online brokerage & wealth management platform with deep root in technology. Futu sits in the confluence of 3 strong favorable forces of Meteorology, Topography & Commander, yet was underpriced at the time of our entry. In terms of Meteorology, there is a huge addressable market of Chinese domestic middle to upper classes’ wealth being deployed to overseas assets allocation in the next decade. Additionally, the incumbents being disrupted are extremely weak in their digital transformation. On Topography, Futu’s user-centric product design built an intuitive front end and great user experience, while the digital native development framework built solid & reliable back end (including a self-developed order routing & execution system for HK market). This is a rare combination compared to both offline incumbents (who lack flashy front end & UX) & other new online disrupters (who lack solid infrastructure). On Commander factor, founder CEO Li Hua was a Tencent engineer in its early days with deep knowledge in product design and development. Li is said to be a fanatic product manager, to this day still at the front-line, alpha testing any new features. Based on analyses of these factors, I think Futu could compound its revenue at a very high rate with very high certainty and with strong operating leverage, putting our entry price very attractive compared to earning power in 3-5 years. Yet just as we finished building a small position, the price started to take off and more than tripled in a month. When such price action happens, it is obvious that Mr. Market has turned very euphoric to this name. I decided to trim but kept a reasonable position given its growth certainty.”
