Baron Funds, an investment management firm, released its “Baron Global Advantage Fund” third quarter 2023 investor letter, a copy of which can be downloaded here. During the third quarter of 2023, the Baron Global Advantage Fund®, denoted as the “Fund,” experienced a 6.1% loss for its Institutional Shares. This performance can be compared to the 3.4% losses of the MSCI ACWI Index, known as the “Benchmark,” and the 4.9% losses for the MSCI ACWI Growth Index, which serves as the Fund’s benchmarks. Take a moment to review the fund’s top 5 holdings to gain insights into their primary investment choices for 2023.
In its Q3 2023 investor letter, Baron Global Advantage Fund mentioned NVIDIA Corporation (NASDAQ:NVDA) and explained its insights for the company. NVIDIA Corporation (NASDAQ:NVDA) is a Santa Clara, California-based multinational technology company with a $1.1 trillion market capitalization. NVIDIA Corporation (NASDAQ:NVDA) delivered a 213.06% return since the beginning of the year, while its 12-month returns are up by 219.91%. The stock closed at $457.51 per share on November 6, 2023.
Here is what Baron Global Advantage Fund has to say about NVIDIA Corporation (NASDAQ:NVDA) in its Q3 2023 investor letter:
“At the portfolio level, the positive fundamental trends we noticed in the second quarter continued into the third quarter as well – many of our companies are reporting stability or slight improvement in business trends. Weighted average 2023 revenue growth expectations for the portfolio were up 3.8% during the third quarter or up 0.8% if we exclude NVIDIA. We wrote at length about NVIDIA earlier this year, but it is worth mentioning that the company has continued to exceed its own projections and the Street’s most optimistic expectations. After raising its revenue and EPS guidance for 2023 by 40% and 69%, respectively, following its last quarter, NVIDIA increased it further by 26% and 35%, respectively, after reporting the most recent one. Consensus expectations now call for revenues to grow 94% this year, while earnings per share are expected to increase by 192%. You may have seen these kinds of growth rates before, but we doubt you saw them from a company generating $50 billion in revenues. The skeptics who continue to question and doubt the accelerating demand for Generative artificial intelligence forgot to tell NVIDIA about it. But we digress…back to the portfolio…profit expectations have risen even faster than revenues and were up 11% during the third quarter (or up 7.8% ex-NVIDIA) with margin expectations up 149bps (107bps ex-NVIDIA). So, broadly speaking, our companies are seeing improvement in overall business trends, which flow through to their bottom lines, driving higher margins. We are also starting to see the benefits of leaner cost structures and more disciplined capital allocation compared to two or three years ago when capital was both cheaper and more readily available.”
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Our calculations show that NVIDIA Corporation (NASDAQ:NVDA) ranks 5th on our list of the 30 Most Popular Stocks Among Hedge Funds. NVIDIA Corporation (NASDAQ:NVDA) was in 175 hedge fund portfolios at the end of the second quarter of 2023, compared to 132 funds in the previous quarter. NVIDIA Corporation (NASDAQ:NVDA) delivered a 0.74% return in the past 3 months. You can find other investor letters from hedge funds and prominent investors on our hedge fund investor letters Q3 2023 page.
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Disclosure: None. This article is originally published at Insider Monkey.
