Baron Funds, an asset management company, released its “Baron Real Estate Fund” second quarter 2022 investor letter. A copy of the same can be downloaded here. Baron Real Estate Fund (the “Fund”) declined 20.62% (Institutional Shares) in the second quarter of 2022, underperforming its primary benchmark, the MSCI USA IMI Extended Real Estate Index (the “MSCI Real Estate Index”), which declined 17.12%. The Fund underperformed the MSCI US REIT Index (the “REIT Index”), which declined 17.16%. In addition, you can check the top 5 holdings of the fund to know its best picks in 2022.
In its Q2 2022 investor letter, Baron Real Estate Fund mentioned Digital Realty Trust, Inc. (NYSE:DLR) and explained its insights for the company. Founded in 2001, Digital Realty Trust, Inc. (NYSE:DLR) is a San Francisco, California-based real estate investment trust company with a $34.0 billion market capitalization. Digital Realty Trust, Inc. (NYSE:DLR) delivered a -34.37% return since the beginning of the year, while its 12-month returns are down by -25.60%. The stock closed at $116.08 per share on September 14, 2022.
Here is what Baron Real Estate Fund has to say about Digital Realty Trust, Inc. (NYSE:DLR) in its Q2 2022 investor letter:
“Digital Realty Trust, Inc. is a premier global data center REIT with more than 290 data centers and more than 4,000 customers. It maintains an investment grade balance sheet. Following a more than 25% correction in its share price in the first six months of 2022, we recently re-initiated a position in Digital Realty Trust, Inc.at what we believe is a compelling valuation. The company is a global data center operator with more than 290 data centers.
Over the last few years, the company has been undergoing a business transformation, which accelerated after its acquisition of Interxion in March 2020, a pure-play European network-dense data center operator. The company has been shedding non-core slower growth assets, investing and expanding in Europe, and growing its retail colocation business. We have spent a significant amount of time with CEO Bill Stein and CFO Andy Power over the years and believe the investments the company has made are on the cusp of bearing fruit and will pay dividends for years to come.
In addition, we believe the fundamentals in its core business are at an inflection point with robust demand and tenant bookings, pricing power, hyperscale cloud companies outsourcing more, and limited competitive capacity. We believe these factors will lead to a growth inflection in the business in 2023 and are optimistic on the long-term prospects for the company.”
Photo by Blake Wheeler on Unsplash
Our calculations show that Digital Realty Trust, Inc. (NYSE:DLR) fell short and didn’t make it on our list of the 30 Most Popular Stocks Among Hedge Funds. Digital Realty Trust, Inc. (NYSE:DLR) was in 33 hedge fund portfolios at the end of the second quarter of 2022, compared to 31 funds in the previous quarter. Digital Realty Trust, Inc. (NYSE:DLR) delivered a -9.97% return in the past 3 months.
In July 2022, we published an article that includes Digital Realty Trust, Inc. (NYSE:DLR) in 5 Dividend Paying REIT Stocks To Buy Now. You can find other investor letters from hedge funds and prominent investors on our hedge fund investor letters 2022 Q2 page.
Disclosure: None. This article is originally published at Insider Monkey.
