Baron Funds, an investment management firm, released its “Baron Technology Fund” third quarter 2023 investor letter, a copy of which can be downloaded here. In the second quarter, the Baron Technology Fund® experienced a 3.89% decline in its Institutional Shares. Despite this decrease, it outperformed the MSCI ACWI Information Technology Index, which saw a steeper decline of 6.16%. However, the Fund slightly underperformed the broader S&P 500 Index, which exhibited a 3.27% decline. Looking at the year-to-date period, the Fund has shown a positive return of 37.34%, surpassing both indexes. The MSCI ACWI Information Technology Index yielded 28.47% while the S&P 500 returned 13.07%. Take a moment to review the fund’s top 5 holdings to gain insights into their primary investment choices for 2023.
In its Q3 2023 investor letter, Baron Technology Fund mentioned Microsoft Corporation (NASDAQ:MSFT) and explained its insights for the company. Microsoft Corporation (NASDAQ:MSFT) is a Redmond, Washington-based multinational technology corporation with a $2.6 trillion market capitalization. Microsoft Corporation (NASDAQ:MSFT) delivered a 48.67% return since the beginning of the year, while its 12-month returns are up by 55.78%. The stock closed at $356.53 per share on November 6, 2023.
Here is what Baron Technology Fund has to say about Microsoft Corporation (NASDAQ:MSFT) in its Q3 2023 investor letter:
“Microsoft Corporation is the world’s largest software company. Microsoft was traditionally known for its Windows and Office products, but over the last five years, it has built an over $60 billion cloud business, including its Azure cloud infrastructure service and its Office 365 and Dynamics 365 cloud-delivered applications. The stock detracted from performance because Microsoft is the Fund’s largest holding and shares retreated 7.0% after strong first half performance. For the June quarter, Microsoft reported better-than-expected Azure results for the third straight period, highlighted by Azure revenue growing 27% in constant currency. Its computing division also beat expectations, with Windows revenue benefiting from an early back-to-school inventory build. Microsoft’s September quarter revenue guidance came in below Street expectations; however, with Azure effectively in line and demonstrating stabilization, but computing seeing the negative sequential impact of the pull-forward in back-to-school purchases. Looking at the big picture, Microsoft continues to execute at a high level, navigating a challenging macro backdrop while aggressively investing in long-term growth, and we remain confident that Microsoft is well positioned to leverage AI over the medium to long term as it infuses Open AI and other generative AI technologies across its entire product portfolio.”
Photo by Microsoft 365 on Unsplash
Our calculations show that Microsoft Corporation (NASDAQ:MSFT) ranks 1st on our list of the 30 Most Popular Stocks Among Hedge Funds. Microsoft Corporation (NASDAQ:MSFT) was in 300 hedge fund portfolios at the end of the second quarter of 2023, compared to 289 funds in the previous quarter. Microsoft Corporation (NASDAQ:MSFT) delivered a 9.35% return in the past 3 months. You can find other investor letters from hedge funds and prominent investors on our hedge fund investor letters Q3 2023 page.
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Disclosure: None. This article is originally published at Insider Monkey.
