Baron Funds, an investment management company, released its “Baron Health Care Fund” second quarter 2024 investor letter. A copy of the letter can be downloaded here. The fund declined 2.55% (Institutional Shares) in the quarter compared to a 1.02% decline for the Russell 3000 Health Care Index (benchmark) and a 3.22% gain for the Russell 3000 Index (the Index). The underperformance in the quarter was due to active sub-industry/market cap weights. In addition, please check the fund’s top five holdings to know its best picks in 2024.
Baron Health Care Fund highlighted stocks like McKesson Corporation (NYSE:MCK), in the second quarter 2024 investor letter. McKesson Corporation (NYSE:MCK) offers healthcare services through U.S. Pharmaceutical, Prescription Technology Solutions (RxTS), Medical-Surgical Solutions, and International segments. The one-month return of McKesson Corporation (NYSE:MCK) was 7.03%, and its shares gained 49.15% of their value over the last 52 weeks. On August 1, 2024, McKesson Corporation (NYSE:MCK) stock closed at $629.09 per share with a market capitalization of $81.6 billion.
Baron Health Care Fund stated the following regarding McKesson Corporation (NYSE:MCK) in its Q2 2024 investor letter:
“Performance in pharmaceuticals and health care distributors was bolstered by solid gains from AstraZeneca PLC and McKesson Corporation (NYSE:MCK), respectively. McKesson is a leading distributor of pharmaceuticals and medical supplies and also provides prescription technology solutions that connect pharmacies, providers, payers, and biopharmaceutical customers. McKesson’s stock reacted positively to the company’s fiscal year 2025 earnings guidance, which came in ahead of investor expectations. We continue to think McKesson can generate mid-teens earnings per share growth annually through organic growth, operating leverage, and share repurchases.”
A successful pharmacist in front of shelves of drugs in a community-based oncology pharmacy.
McKesson Corporation (NYSE:MCK) is not on our list of 31 Most Popular Stocks Among Hedge Funds. As per our database, 72 hedge fund portfolios held McKesson Corporation (NYSE:MCK) at the end of the first quarter which was 69 in the previous quarter. McKesson Corporation (NYSE:MCK) reported $76.4 billion in revenue for the fourth quarter of fiscal year 2024, an 11% increase from the previous year. While we acknowledge the potential of McKesson Corporation (NYSE:MCK) 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 another article, we discussed McKesson Corporation (NYSE:MCK) and shared ClearBridge Large Cap Value Strategy’s views on the company. In addition, please check out our hedge fund investor letters Q2 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.
