Polen Capital Management, a value-driven, concentrated, long-term investment management firm, published its ‘Polen Global Growth’ fourth-quarter 2020 Investor Letter – a copy of which can be downloaded here. A return of 7.70% was recorded by the fund for the Q4 of 2020, below its MSCI All-Country World benchmark that delivered a 14.69% return. You can view the fund’s top 5 holdings to have a peek at their top bets for 2021.
Polen Global Growth, in their Q4 2020 Investor Letter said that Alibaba Group Holding Limited (NYSE: (BA)(BA)) was one of the top detractors for the fund during the fourth quarter of 2020. Alibaba Group Holding Limited is the world’s biggest online commerce company that currently has a $731.4 billion market cap. For the past 3 months, (BA)(BA) delivered a -11.33% return and settled at $266.96 per share at the closing of February 4th.
Here is what Polen Global Growth has to say about Alibaba Group Holding Limited in their investor letter:
“One of our largest detractors during the quarter was Alibaba Group Holding Limited. Alibaba Group’s stock declined by over 20% during the fourth quarter. China delayed the Ant Financial initial public offering (IPO) and launched an anti-trust investigation into alleged anticompetitive practices by Alibaba. Many speculate that this was a strong signal from the government in response to comments made by Alibaba founder Jack Ma.
Regardless of the reason, while we acknowledge that operating in China is different than in the U.S., we also recognize Alibaba’s dominance and importance to China’s long-term goals. As China reorients its economy from export-driven to domestic consumption, Alibaba’s platforms—Taobao and Tmall—are arguably the very best tools to achieve this. Alibaba enables commerce throughout the country from tier one cities to rural areas. Its competitive advantages, tailwinds in digital payments, e-commerce, and cloud technologies are poised for continued growth even with potential government penalties in the future. It remains one of our highest conviction positions.”
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