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 Glaukos Corporation (NYSE:GKOS) in the second quarter 2024 investor letter. Glaukos Corporation (NYSE:GKOS) is an ophthalmic pharmaceutical and medical technology company. The one-month return of Glaukos Corporation (NYSE:GKOS) was -3.42%, and its shares gained 58.04% of their value over the last 52 weeks. On August 1, 2024, Glaukos Corporation (NYSE:GKOS) stock closed at $117.61 per share with a market capitalization of $6.448 billion.
Baron Health Care Fund stated the following regarding Glaukos Corporation (NYSE:GKOS) in its Q2 2024 investor letter:
“Another new addition was Glaukos Corporation (NYSE:GKOS), which develops and sells interventional glaucoma treatments. Glaukos is launching iDose, a new minimally invasive drug-delivery device that treats glaucoma. Glaucoma is when a patient has high pressure inside the eye, which damages the optic nerve and can lead to blindness. Most patients with glaucoma are treated with daily prostaglandin eye drops, but: 1) patients are notoriously noncompliant leading to lower efficacy (more than 90% of patients are noncompliant and around 50% discontinue their medication within six months); and 2) prostaglandin eye drops cause bothersome side effects including dry eye, red eyes, and periorbital fat loss “raccoon eyes.” An iDose is implanted as a five minute procedure and delivers a highly concentrated prostaglandin formulation inside the eye that is effective for up to three plus years. Compared to prostaglandin eye drops, iDose ensures patient compliance and the intraocular dosing significantly reduces side effects. We think glaucoma is a large market (there are approximately 3 million patients in the U.S. with glaucoma and up to an additional 6 million patients with ocular hypertension that are eligible for iDose) and is ripe for new standalone interventions. We think that iDose can be a $1 billion product over time and are bullish on Glaukos shares.”
A doctor examining a patient’s eyes with an ophthalmic medical device.
Glaukos Corporation (NYSE:GKOS) is not on our list of 31 Most Popular Stocks Among Hedge Funds. As per our database, 27 hedge fund portfolios held Glaukos Corporation (NYSE:GKOS) at the end of the first quarter which was 25 in the previous quarter. In the second quarter, Glaukos Corporation (NYSE:GKOS) reported net sales of $95.7 million, up 19% on a reported basis and 20% on a constant currency basis compared to Q2 2023. The outstanding performance led the company to increase its full-year 2024 net sales guidance range. While we acknowledge the potential of Glaukos Corporation (NYSE:GKOS) 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 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.
