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 Choice Hotels International, Inc. (NYSE:CHH). Headquartered in North Bethesda, Maryland, Choice Hotels International, Inc. (NYSE:CHH) operates as a hotel franchisor. The one-month return of Choice Hotels International, Inc. (NYSE:CHH) was 1.64%, and its shares gained 29.52% of their value over the last 52 weeks. On February 19, 2025, Choice Hotels International, Inc. (NYSE:CHH) stock closed at $147.69 per share with a market capitalization of $6.93 billion.
Baron Growth Fund stated the following regarding Choice Hotels International, Inc. (NYSE:CHH) in its Q4 2024 investor letter:
“Choice Hotels International, Inc. (NYSE:CHH), a global franchisor of hotels under 10 brands, contributed to performance due to accelerating revenue per available room across its portfolio. Combined with an expected increase in the number of units, this revenue growth should produce solid earnings results in 2025. Choice Hotels has a healthy balance sheet in line with long[1]term targets, which will enable it to use any excess cash flow generated by earnings toward share buybacks and dividends. The stock continues to trade at a discount to its long-term average multiple, and we still compelling upside despite recent strong performance.”
A hotel lobby in vibrant colors, reflecting the hospitality and global presence of the hotel franchising company.
Choice Hotels International, Inc. (NYSE:CHH) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 18 hedge fund portfolios held Choice Hotels International, Inc. (NYSE:CHH) at the end of the fourth quarter which was 14 in the previous quarter. While we acknowledge the potential of Choice Hotels International, Inc. (NYSE:CHH) 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 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.