Breaking down the stocks Norbert Lou (Punch Card Capital) bought, sold, and held in Q2 2025, including their holdings at the end of the quarter. All data sourced from Punch Card Capital's 13F filed on August 14, 2025.
Who are Norbert Lou and Punch Card Capital?
Norbert Lou is the founder and manager of Punch Card Management L.P. (commonly referred to as Punch Card Capital). The fund is known for its highly concentrated portfolio, typically consisting of 3-6 stocks at any given time, with significant cash holdings (averaging 25%) when attractive opportunities are scarce. His investment strategy is a classic value investing approach inspired by Warren Buffett's "punch card" philosophy, where one should invest as if limited to 20 punches in a lifetime. Lou focuses on underfollowed, undervalued companies that can compound intrinsic value at high rates over long periods, with strong qualitative factors like high returns on capital, reinvestment opportunities, economies of scale, and brand power.
Punchcardcapital.com
Norbert Lou on X
Q2 '25 13F filed with SEC
Holdings in Q2 2025
| Ticker | Company | Weight | Change | Value |
|---|---|---|---|---|
| BRK-A | Berkshire Hathaway | 34.1% | $105.68M | |
| SGOV | 0-3 Month Treasury | 18.4% | Trimmed (-3%) | $56.99M |
| CROX | Crocs | 17.4% | NEW | $53.79M |
| PYPL | PayPal | 15.6% | NEW | $48.34M |
| PDD | PDD Holdings | 14.0% | Added (+35%) | $43.43M |
| SWBI | Smith & Wesson | 0.5% | Trimmed (-71%) | $1.65M |
Current Investment Strategy
Punch Card Capital maintained its ultra-concentrated value investing approach in Q2 2025 with just six holdings totaling $310 million, anchored by a 34% position in Berkshire Hathaway while initiating new stakes in Crocs (17.4% of portfolio) and PayPal (15.6%), two beaten-down consumer and fintech names trading at steep discounts with aggressive buyback programs. The fund held 18% in short-term Treasuries and increased its position in Chinese e-commerce player PDD Holdings by 35%, consistent with founder Norbert Lou's philosophy of investing in underfollowed, undervalued companies capable of compounding intrinsic value at high rates over extended periods.
New Investments
Crocs CROX
Norbert Lou bought $53.79M of Crocs in Q2 2025. Crocs faced headwinds in Q3 2025 with consolidated revenue declining 6.2% year-over-year to $996.3 million, pressured by weakness in North America and significant challenges at the HEYDUDE brand. However, the core Crocs brand demonstrated resilience with only a 2.5% revenue decline, driven by 5.8% international growth and 1.6% direct-to-consumer expansion despite 14.7% wholesale headwinds. The company is taking decisive action through aggressive cost management, having identified $150 million in gross cost savings for 2025-2026 and additional $100 million for 2026, while maintaining strong cash generation with $226 million in free cash flow enabling $203 million in share repurchases.
- Adjusted diluted EPS declined 18.9% to $2.92 from $3.60 year-over-year, with operating margin contracting 460 basis points to 20.8%.
- International segment grew 5.8% while North America fell 8.8%, signaling geographic divergence and meaningful expansion opportunity.
- HEYDUDE brand deteriorated significantly with revenue down 21.6% and wholesale channel declining 38.6%, while company pivots toward higher-margin direct-to-consumer strategies.
PayPal PYPL
Norbert Lou bought $48.34M of PayPal in Q2 2025. PayPal returned to growth in Q3 2025, with management targeting 6-7% transaction margin dollar growth for the full year 2025 when excluding interest on customer balances. The company's inflection to positive growth represents a significant milestone after experiencing prior period challenges. The market responded favorably, with the stock gaining 2.27% in early November 2025.
- Targeting 6-7% transaction margin dollar growth for 2025 (excluding interest on customer balances).
- Stock up 2.27% to $66.79 per share as of November 4, 2025.
- Q3 2025 marked return to growth trajectory after prior period contraction.
Added, Trimmed, and Exited
Added
Norbert Lou increased his position in PDD Holdings (PDD), adding 108,253 shares (+35%) to grow the position from $36.30M to $43.43M, which generated a 19.64% return during the quarter.
What it means: This addition demonstrates continued conviction in the Chinese e-commerce platform despite ongoing macro headwinds in China. The willingness to add to PDD Holdings at higher prices after a nearly 20% gain suggests Lou sees substantial remaining upside, consistent with his concentrated approach of scaling into his highest-conviction ideas. Given Punch Card Capital's typical 3-6 stock portfolio, this position now represents approximately 17% of the disclosed equity portfolio, signaling it remains a core holding.
Trimmed
Norbert Lou significantly reduced Smith & Wesson (SWBI) by 71% (from 648,956 to 189,933 shares), cutting the position from $6.05M to $1.65M after a -72.74% loss. He also made a minor trim to 0-3 Month Treasury (SGOV), reducing it by 2.6% from $58.50M to $56.99M.
What it means: The dramatic reduction in Smith & Wesson after such steep losses suggests a thesis break or revaluation of the investment case. Rather than averaging down—a strategy value investors often employ—Lou chose to largely exit, indicating the original investment rationale may no longer hold or better opportunities emerged. The small trim to treasury holdings likely reflects redeployment of cash into the two new equity positions (Crocs and PayPal), reducing dry powder as attractive opportunities materialized.
Exited
Punch Card Capital did not fully exit any positions during Q2 2025.
Disclaimer: All posts are for informational purposes only. They are NOT a recommendation to buy or sell the securities discussed. Please do your own research and due diligence before investing your money.
