Baron Funds, an investment management company, released its “Baron Asset Fund” first quarter 2023 investor letter. A copy of the same can be downloaded here. The fund appreciated 5.34% in the first quarter, trailing the Russell Midcap Growth Index, which returned 9.14%. Stock selection drove the fund to underperform in the quarter. IT, Communication Services, and Consumer Discretionary were the strongest performing sectors, while Energy and Financials were the principal laggards. Furthermore, defensive-oriented sectors, Health Care, Utilities, and Consumer Staples also struggled in the quarter. In addition, please check the fund’s top five holdings to know its best picks in 2023.
Baron Asset Fund highlighted stocks like Guidewire Software, Inc. (NYSE:GWRE) in the first quarter 2023 investor letter. Headquartered in San Mateo, California, Guidewire Software, Inc. (NYSE:GWRE) is a software product-providing company for P&C insurers. On May 1, 2023, Guidewire Software, Inc. (NYSE:GWRE) stock closed at $75.86 per share. One-month return of Guidewire Software, Inc. (NYSE:GWRE) was -6.69%, and its shares lost 10.83% of their value over the last 52 weeks. Guidewire Software, Inc. (NYSE:GWRE) has a market capitalization of $6.188 billion.
Baron Asset Fund made the following comment about Guidewire Software, Inc. (NYSE:GWRE) in its Q1 2023 investor letter:
“Shares of property and casualty (P&C) insurance software vendor Guidewire Software, Inc. (NYSE:GWRE) contributed to performance for the quarter. The company has crossed the midpoint of its transition from an on-premise to a cloud-based software provider, and we believe this should result in more consistent recurring revenue growth and durable gross margin expansion. We believe Guidewire will become the critical software vendor for the global P&C insurance industry, capturing a significant share of a $30 billion addressable market. During the quarter, Guidewire’s largest (and, we believe, inferior) competitor was acquired by a private equity firm at a meaningful premium to Guidewire’s current valuation. We believe this acquisition will result in a stronger relative competitive position for Guidewire, while also illustrating a significant multiple expansion opportunity embedded in its current share price.”
Guidewire Software, Inc. (NYSE:GWRE) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 43 hedge fund portfolios held Guidewire Software, Inc. (NYSE:GWRE) at the end of the fourth quarter which was 37 in the previous quarter.
We discussed Guidewire Software, Inc. (NYSE:GWRE) in another article and shared Baron Growth Fund’s views on the company in the previous quarter. In addition, please check out our hedge fund investor letters Q1 2023 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.
