Baron Funds, an investment management company, released its “Baron Growth Fund” fourth quarter 2024 investor letter. A copy of the letter can be downloaded here. The fund appreciated 5.02% (Institutional Shares) in 2024, trailing the Russell 2000 Growth Index’s (the Benchmark) 15.15% return. Approximately 25% of the fund’s underperformance was attributed to short-term cyclical headwinds and temporary growth investments, while the remaining underperformance was due to a focus on high-quality compounding growth businesses. In addition, please check the fund’s top five holdings to know its best picks in 2024.
In its fourth quarter 2024 investor letter, Baron Growth Fund emphasized stocks such as Gartner, Inc. (NYSE:IT). Established in 1979, Gartner, Inc. (NYSE:IT) is a research and advisory company that operates through research, conferences, and consulting segments. The one-month return of Gartner, Inc. (NYSE:IT) was -1.68%, and its shares gained 13.79% of their value over the last 52 weeks. On February 19, 2025, Gartner, Inc. (NYSE:IT) stock closed at $516.01 per share with a market capitalization of $39.64 billion.
Baron Growth Fund stated the following regarding Gartner, Inc. (NYSE:IT) in its Q4 2024 investor letter:
“Shares of Gartner, Inc. (NYSE:IT), a provider of syndicated research, detracted from performance as core subscription growth remained stable rather than inflecting higher. We believe trends are poised to accelerate over the next several quarters as comparisons ease and business conditions improve. In our view, Gartner will emerge as a critical decision support resource for every company evaluating the opportunities and risks of AI on its business, which should provide a tailwind to volume growth and pricing realization over time. We expect Gartner’s sustained revenue growth and focus on cost control to drive continued margin expansion and enhanced free cash flow generation. The company’s balance sheet is in excellent shape and can support aggressive repurchases and bolt-on acquisitions.”
Close up of a person working on a laptop, researching, coding and deploying content publishing projects.
Gartner, Inc. (NYSE:IT) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 57 hedge fund portfolios held Gartner, Inc. (NYSE:IT) at the end of the fourth quarter which was 35 in the previous quarter. Gartner, Inc.’s (NYSE:IT) fourth quarter revenue was $1.7 billion, representing an 8% year-over-year increase. While we acknowledge the potential of Gartner, Inc. (NYSE:IT) 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 another article we discussed Gartner, Inc. (NYSE:IT) and shared the list of best information technology services stocks to invest. Gartner, Inc. (NYSE:IT) contributed to Baron Asset Fund’s performance in the previous quarter as its subscription research businesses experienced a surge. In addition, please check out our hedge fund investor letters Q4 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.