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Baupost Group is Betting on eBay (EBAY) Stock

Alex Smith
·3 mins read

Baupost Group recently released its Q2 2020 Investor Letter, a copy of which you can download here. The fund posted strong gains for the quarter, a substantial but not quite complete rebound from the first quarter drop. You should check out Baupost Group's top 5 stock picks for investors to buy right now, which could be the biggest winners of the stock market crash.

In the said letter, Baupost Group highlighted a few stocks and eBay Inc (NASDAQ:EBAY) is one of them. eBay Inc (NASDAQ:EBAY) is an e-commerce company. Year-to-date, eBay Inc (NASDAQ:EBAY) stock gained 59.8% and on August 19th it had a closing price of $57.71. Baupost Group cared to mention eBay Inc (NASDAQ:EBAY) in its investor letter, though they didn't say why they really like the stock. All they said is this:

"EBay’s share price has risen as its marketplace business has benefitted greatly from the current environment. Sales volumes on the eBay marketplace are expected to increase from flat in Q1 to 25%+ growth in Q2. We expect revenue to grow well in excess of volume growth going forward as the company begins to replace its PayPal relationship with its own managed payment system. In mid-July, the company announced plans to sell its online classified business to Adevinta at an attractive valuation for cash and equity in the combined company."

Last month, we published an article revealing that Steel City Capital is bullish about eBay Inc (NASDAQ:EBAY) stock. The investment firm believes that the company continues to benefit from the shift in trend as consumers order online.

In Q1 2020, the number of bullish hedge fund positions on eBay Inc (NASDAQ:EBAY) stock increased by about 2% from the previous quarter (see the chart here), so a number of other hedge fund managers seem to agree with eBay's growth potential. Our calculations showed that eBay Inc (NASDAQ:EBAY) 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. We go through lists like the 10 most profitable companies in America 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. If you want to find out the best healthcare stock to buy right now, you can watch our latest hedge fund manager interview here. You can subscribe to our free enewsletter below to receive our stories in your inbox:

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