Baron Funds, an investment management company, released its “Baron Discovery Fund” fourth quarter 2022 investor letter. A copy of the same can be downloaded here. The fund’s performance was flat compared to the Russell 2000 Growth Index in the fourth quarter. The fund (institutional shares) returned 0.22% compared to the benchmark return of 4.13%. The fund (institutional shares) fell by 35.12% for the full year compared to a 26.36% decline for the benchmark. In addition, please check the fund’s top five holdings to know its best picks in 2022.
Baron Discovery Fund highlighted stocks like Definitive Healthcare Corp. (NASDAQ:DH) in the Q4 2022 investor letter. Headquartered in Framingham, Massachusetts, Definitive Healthcare Corp. (NASDAQ:DH) is a healthcare commercial intelligence provider. On February 24, 2023, Definitive Healthcare Corp. (NASDAQ:DH) stock closed at $12.02 per share. One-month return of Definitive Healthcare Corp. (NASDAQ:DH) was 0.25%, and its shares lost 48.01% of their value over the last 52 weeks. Definitive Healthcare Corp. (NASDAQ:DH) has a market capitalization of $1.264 billion.
Baron Discovery Fund made the following comment about Definitive Healthcare Corp. (NASDAQ:DH) in its Q4 2022 investor letter:
“Shares of Definitive Healthcare Corp. (NASDAQ:DH), a commercial intelligence software provider for health care companies, underperformed as management highlighted intensifying macro headwinds and talked about expectations for 2023 revenue growth to be about 15% opposed to investor expectations for mid-20% revenue growth. Definitive first discussed the macro headwinds in the previous quarter, but the headwinds have intensified and are expected to persist. The slowing of the sales cycle has broadened beyond new logos to upsells to existing customers, and it is particularly pronounced among biotechnology and provider clients. Recognizing the wide error bars around 2023 results, management wanted to wait to see the rest of the fourth quarter selling season play out before providing formal 2023 guidance, which they should provide when the company reports in February. We believe that these macro-related headwinds are temporary in nature, and we continue to see Definitive as a high-quality, profitable company with a differentiated offering and a long runway of growth. We think the current valuation implies significantly lower long-term growth expectations than the company is capable of producing. Therefore, there could be meaningful upside as macro conditions improve and revenue growth re-accelerates.”
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Definitive Healthcare Corp. (NASDAQ:DH) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 14 hedge fund portfolios held Definitive Healthcare Corp. (NASDAQ:DH) at the end of the fourth quarter which was 11 in the previous quarter.
We discussed Definitive Healthcare Corp. (NASDAQ:DH) in another article and shared Alger Capital’s views on the company. In addition, please check out our hedge fund investor letters Q4 2022 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.
