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Wedgewood Partners, an investment management company, released its fourth quarter 2023 investor letter. A copy of the same can be downloaded here. In the fourth quarter, Wedgewood Composite’s net return was 11.4% compared to the Standard & Poor’s 11.7%, Russell 1000 Growth Index’s 14.2%, and Russell 1000 Value Index’s 9.5% return for the same period. Year-to-date, the fund returned 29.2% compared to 26.3%, 42.7%, and 11.5%, respectively for the indexes. In addition, you can check the top 5 holdings of the fund to know its best picks in 2023.
Wedgewood Partners featured stocks such as PayPal Holdings, Inc. (NASDAQ:PYPL) in the fourth quarter 2023 investor letter. Headquartered in San Jose, California, PayPal Holdings, Inc. (NASDAQ:PYPL) is a technology platform that enables digital payments. On January 12, 2024, PayPal Holdings, Inc. (NASDAQ:PYPL) stock closed at $61.00 per share. One-month return of PayPal Holdings, Inc. (NASDAQ:PYPL) was -0.42%, and its shares lost 23.25% of their value over the last 52 weeks. PayPal Holdings, Inc. (NASDAQ:PYPL) has a market capitalization of $65.772 billion.
Wedgewood Partners stated the following regarding PayPal Holdings, Inc. (NASDAQ:PYPL) in its fourth quarter 2023 investor letter:
“PayPal Holdings, Inc. (NASDAQ:PYPL) also contributed less to portfolio performance than most holdings during the fourth quarter. The total payment volume handled by PayPal during its most recent quarter grew +15%, which helped drive healthy revenue growth and +20% earnings per share growth. Critically, the Company's new management team has significant opportunity to drive more revenue and earnings growth across the massive, multi-trillion-dollar payments addressable market. PayPal's rapidly growing payment processing brand, Braintree, represents one of those revenue growth opportunities, either by raising prices, as the Company had previously used a low-price strategy to establish a beachhead in this market, or by adding value-added services. PayPal's branded checkout remains the largest volume and profit driver for the business, and we expect this to continue to track in-line with e-commerce growth in the near term, and eventually take share as the Company rolls out new features to its over +400 million users and +30 million merchants. We added to our position with the stock trading at just 10X forward earnings estimates during the quarter because there are many more long-term growth opportunities relative to most financial companies that trade for similar multiples and compared to technology companies that trade for much higher multiples.”