Baron Funds, an investment management company, released its “Baron FinTech Fund” second quarter 2024 investor letter. A copy of the letter can be downloaded here. In the second quarter, the fund declined 2.25% (Institutional Shares) compared to a (5.78)% return for the FactSet Global FinTech Index (Benchmark) and a 4.28% gain for the S&P 500 index. US equities rose with major market indices reaching all-time highs during the second quarter. Overwhelming corporate results were accompanied by mixed economic data that points to further moderation of inflation. However, the rally was concentrated and driven by mega-cap technology companies. The fund’s smaller market cap profile and lack of exposure to the Magnificent Seven led the fund to underperform the broader market. In addition, please check the fund’s top five holdings to know its best picks in 2024.
Baron FinTech Fund highlighted stocks like Houlihan Lokey, Inc. (NYSE:HLI), in the second quarter 2024 investor letter. Houlihan Lokey, Inc. (NYSE:HLI) is an investment banking company, that provides merger and acquisition (M&A), capital market, financial restructuring, and financial and valuation advisory services. The one-month return of Houlihan Lokey, Inc. (NYSE:HLI) was -1.00%, and its shares gained 45.68% of their value over the last 52 weeks. On August 12, 2024, Houlihan Lokey, Inc. (NYSE:HLI) stock closed at $146.82 per share with a market capitalization of $10.209 billion.
Baron FinTech Fund stated the following regarding Houlihan Lokey, Inc. (NYSE:HLI) in its Q2 2024 investor letter:
“Favorable stock selection in the Capital Markets theme contributed the most to relative performance. Global investment bank Houlihan Lokey, Inc. (NYSE:HLI) performed well on expectations for M&A activity to improve from cyclically depressed levels due to stabilizing interest rates, firming corporate valuations, and significant dry powder across private equity funds that will eventually be deployed into new investments.”
A close-up of hands shaking to signify a newly negotiated financial restructuring transaction.
Houlihan Lokey, Inc. (NYSE:HLI) is not on our list of 31 Most Popular Stocks Among Hedge Funds. As per our database, 19 hedge fund portfolios held Houlihan Lokey, Inc. (NYSE:HLI) at the end of the first quarter which was 19 in the previous quarter. In the second quarter, Houlihan Lokey, Inc. (NYSE:HLI) generated $514 million in revenues up 24% and adjusted earnings per share of $1.22, up 37% from Q2 2023. While we acknowledge the potential of Houlihan Lokey, Inc. (NYSE:HLI) as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is as promising as NVIDIA but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
In addition, please check out our hedge fund investor letters Q2 2024 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.
