Miller Value Partners recently released its Q3 2020 Investor Letter, a copy of which you can download here. The Opportunity Equity Fund posted a return of 13.01% for the quarter (net of fees), outperforming its benchmark, the S&P 500 Index which returned 8.93% in the same quarter. You should check out Miller Value Partners’ top 5 stock picks for investors to buy right now, which could be the biggest winners of this year.
In the said letter, Miller Value Partners highlighted a few stocks and Farfetch Ltd (NYSE:FTCH) is one of them. Farfetch Ltd (NYSE:FTCH) is an online luxury fashion retail platform that sells products from over 700 boutiques and brands from around the world. Year-to-date, Farfetch Ltd (NYSE:FTCH) stock gained 171.8% and on October 30th it had a closing price of $28.13. Here is what Miller Value Partners said:
“Farfetch Ltd (FTCH)continued to gain during the quarter returning 45.6% as the company reported another quarter that beat expectations while providing strong guidance. The company reported Digital Platform Gross Merchandise Values (GMV) grew +34% above prior guidance of 25-30% and consensus for +26%. The company added ~500k new customers, growing its active customer base by 42%. The company had lower promotional spend leading to order contribution margins increasing to 35% with earnings before income, taxes, depreciation and amortization (EBITDA) loss beating at -$25M versus -$30m expected. The company reiterated EBITDA profitability in 2021. The company guided for 3Q digital platform GMV growth of 40-45% (+30% consensus) with order contribution margins of 32-35% (consensus 31%) leading to EBITDA of -$25M to -$20M (consensus of -$34M).”
In July, we published an article revealing Miller Value Partners bullish investment thesis on Farfetch Ltd (NYSE:FTCH) stock in its Q2 2020 investor letter. This suggests that the investment firm has been bullish for a long time on Farfetch Ltd (NYSE:FTCH).
In Q2 2020, the number of bullish hedge fund positions on Farfetch Ltd (NYSE:FTCH) stock increased by about 68% from the previous quarter (see the chart here), so a number of other hedge fund managers believe in Farfetch’s growth potential. Our calculations showed that Farfetch Ltd (NYSE:FTCH) isn’t ranked among the 30 most popular stocks among hedge funds.
The top 10 stocks among hedge funds returned 185% since the end of 2014 and outperformed the S&P 500 Index ETFs by more than 109 percentage points. We know it sounds unbelievable. You have been dismissing our articles about top hedge fund stocks mostly because you were fed biased information by other media outlets about hedge funds’ poor performance. You could have doubled the size of your nest egg by investing in the top hedge fund stocks instead of dumb S&P 500 ETFs. Below you can watch our video about the top 5 hedge fund stocks right now. All of these stocks had positive returns in 2020.
Video: Top 5 Stocks Among Hedge Funds
At Insider Monkey we scour multiple sources to uncover the next great investment idea. For example, lithium mining is one of the fastest growing industries right now, so we are checking out stock pitches like this emerging lithium stock. We go through lists like the 10 most profitable companies in the world to pick the best large-cap stocks to buy. Even though we recommend positions in only a tiny fraction of the companies we analyze, we check out as many stocks as we can. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. You can subscribe to our free daily newsletter on our website:
Disclosure: None. This article is originally published at Insider Monkey.