Is Revolve Group (RVLV) A Smart Long-Term Buy?

Polen Capital, an investment management firm, published its “Polen U.S. Small Company Growth” first quarter 2021 investor letter – a copy of which can be downloaded here. A return of 0.99% was delivered by the fund for the first quarter of 2021, trailing its Russell 2000 Growth benchmark that delivered a 4.87% gain for the same period. You can view the fund’s top 5 holdings to have a peek at their top bets for 2021.

Polen U.S. Small Company Growth Fund, in its Q1 2021 investor letter, mentioned Revolve Group, Inc. (NYSE: RVLV), and shared their insights on the company. Revolve Group, Inc. is a Cerritos, California-based online fashion retailer that currently has a $3.4 billion market capitalization. Since the beginning of the year, RVLV delivered a 54.60% return, extending its 12-month gains to 230.29%. As of May 21, 2021, the stock closed at $48.19 per share.

Here is what Polen U.S. Small Company Growth Fund has to say about Revolve Group, Inc. in its Q1 2021 investor letter:

Revolve is a leading, next-generation online retailer of apparel, accessories, and beauty for fashion-forward people. During the pandemic, Revolve pivoted its offerings and strategy to adapt to the new normal. The company expanded into adjacent categories like beauty, activewear, and intimates, enabling it to serve its customers’ more immediate needs, increase wallet share, and touch more aspects of their lives. This strategy shift was a success. The company delivered record profitability and free cash flow during Q4 2020.

The leadership team intends to use this strong position to prioritize several key strategic investments as the world recovers from COVID-19, including strengthening their Owned Brands portfolio, expanding marketing, and accelerating brand building
around the globe. The company reported a record high Net Promoter Score (NPS) for 2020. In geographies where COVID-19 is considered generally under control, the company has seen a return of customer demand for their traditional product categories as well.”

model sitting with legs elongated to show designer shoes

Image Credit: Pixabay

Our calculations show that Revolve Group, Inc. (NYSE: RVLV) does not belong in our list of the 30 Most Popular Stocks Among Hedge Funds. As of the end of the first quarter of 2021, Revolve Group, Inc. was in 29 hedge fund portfolios, compared to 24 funds in the fourth quarter of 2020. RVLV delivered a 29.06% return in the past 3 months.

The top 10 stocks among hedge funds returned 231.2% between 2015 and 2020, and outperformed the S&P 500 Index ETFs by more than 126 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. Here you can watch our video about the top 5 hedge fund stocks right now. All of these stocks had positive returns in 2020.

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Disclosure: None. This article is originally published at Insider Monkey.