Baron Funds, an investment management company, released its “Baron Health Care Fund” second quarter 2023 investor letter. A copy of the same can be downloaded here. The fund advanced 9.22% (Institutional Shares) in the quarter compared to a 3.44% gain for the Russell 3000 Health Care Index (benchmark) and an 8.74% gain for the S&P 500 Index. Since its inception, on April 30, 2018, the fund gained 13.58% on an annualized basis, compared to the benchmark’s 10.85% gain and the S&P 500 Index’s 12.54% return. Favorable stock selection led the fund to outperform in the quarter. Investments in biotechnology, pharmaceuticals, and healthcare equipment accounted for most of the relative gains of the fund in the quarter. In addition, please check the fund’s top five holdings to know its best picks in 2023.
Baron Health Care Fund highlighted stocks like Humana Inc. (NYSE:HUM) in the second quarter 2023 investor letter. Headquartered in Louisville, Kentucky, Humana Inc. (NYSE:HUM) is an American health and well-being company. On July 24, 2023, Humana Inc. (NYSE:HUM) stock closed at $453.44 per share. One-month return of Humana Inc. (NYSE:HUM) was 1.69%, and its shares lost 7.89% of their value over the last 52 weeks. Humana Inc. (NYSE:HUM) has a market capitalization of $56.655 billion.
Baron Health Care Fund made the following comment about Humana Inc. (NYSE:HUM) in its second quarter 2023 investor letter:
“These positive effects were somewhat offset by adverse stock selection in managed health care, where the Fund’s investments in health insurance leaders Humana Inc. (NYSE:HUM) and Elevance Health, Inc. were a modest drag on performance. Humana and Elevance Health were down during the quarter because of commentary from UnitedHealth Group Incorporated management indicating that medical cost trends were running at the high end of their guidance driven by higher levels of outpatient medical activity, particularly among Medicare patients. We think UnitedHealth, Humana, and Elevance will be able to manage through an uptick in medical cost trends, but we modestly reduced our positions in Humana and Elevance due to the potential impact on earnings.
We continue to own UnitedHealth, Humana Inc., and Elevance Health, Inc. because we believe these companies will be able to manage through this period without a material earnings impact, but we did modestly reduce our positions in Humana and Elevance Health.”
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Humana Inc. (NYSE:HUM) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 68 hedge fund portfolios held Humana Inc. (NYSE:HUM) at the end of first quarter which was 67 in the previous quarter.
We discussed Humana Inc. (NYSE:HUM) in another article and shared Rob Citrone Podcast and stock picks. In addition, please check out our hedge fund investor letters Q2 2023 page for more investor letters from hedge funds and other leading investors.
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Disclosure: None. This article is originally published at Insider Monkey.
