Here’s Why Baron Funds Exited its TPI Composites (TPIC) Position

Baron Funds, an asset management firm, published its “Baron Discovery Fund” fourth quarter 2021 investor letter – a copy of which can be downloaded here. A quarterly return of 3.13% was delivered by the fund’s institutional shares for the fourth quarter of 2021, which was better than the Russell 2000 Growth Index’s 0.01% return, but below the S&P 500 Index’s gain of 11.03% for the same period. Spare some time to check the fund’s top 5 holdings to have a clue about their top bets for 2022.

Baron Discovery Fund, in its Q4 2021 investor letter, mentioned TPI Composites, Inc. (NASDAQ: TPIC) and discussed its stance on the firm. TPI Composites, Inc. is a Scottsdale, Arizona-based wind-blade manufacturing company with a $442.9 million market capitalization. TPIC delivered a -20.12% return since the beginning of the year, while its 12-month returns are down by -82.60%. The stock closed at $11.95 per share on January 20, 2022.

Here is what Baron Discovery Fund has to say about TPI Composites, Inc. in its Q4 2021 investor letter:

“TPI Composites, Inc. is a manufacturer of composite blades for electricity generating wind turbines, and composite bodies for electric buses. While we admire the management team, the thesis underpinning the investment has just gotten too difficult given dramatic uncertainty in numerous areas. These include government subsidy status in the U.S., global logistics issues related to the pandemic, massive inflation in raw materials costs including steel and resin, and pandemic-related project halts that have hindered the ability for the company to optimize plant utilization. Given the meaningful increase in risk during the quarter, we exited the position.”

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Our calculations show that TPI Composites, Inc. (NASDAQ: TPIC) failed to obtain a mark on our list of the 30 Most Popular Stocks Among Hedge Funds. TPIC was in 19 hedge fund portfolios at the end of the third quarter of 2021, compared to 20 funds in the previous quarter. TPI Composites, Inc. (NASDAQ: TPIC) delivered a -64.62% return in the past 3 months.

In April 2021, we also shared another hedge fund’s views on TPIC in another article. You can find other letters from hedge funds and prominent investors on our hedge fund investor letters 2021 Q4 page.

Disclosure: None. This article is originally published at Insider Monkey.