Baron Funds, an investment management company, released its “Baron Opportunity Fund” third quarter 2022 investor letter. A copy of the same can be downloaded here. In the third quarter, the fund declined 2.38% (Institutional Shares) compared to a 3.37% decline for the Russell 3000 Growth Index and a 4.88% decline for the S&P 500 Index. The fund fell sharply for the year-to-date and trailing 12-month periods; however, the philosophy of the fund is to achieve strong long-term performance. In addition, please check the fund’s top five holdings to know its best picks in 2022.
Baron Funds discussed stocks like NVIDIA Corporation (NASDAQ:NVDA) in the Q3 2022 investor letter. Headquartered in Santa Clara, California, NVIDIA Corporation (NASDAQ:NVDA) is a global graphics, and compute and networking solutions provider. On October 31, 2022, NVIDIA Corporation (NASDAQ:NVDA) stock closed at $134.97 per share. One-month return of NVIDIA Corporation (NASDAQ:NVDA) was 2.51% and its shares lost 48.88% of their value over the last 52 weeks. NVIDIA Corporation (NASDAQ:NVDA) has a market capitalization of $336.345 billion.
Here is what Baron Funds specifically said about NVIDIA Corporation (NASDAQ:NVDA) in its Q3 2022 investor letter:
“NVIDIA Corporation (NASDAQ:NVDA) is a fabless semiconductor company and a leader in gaming and accelerated computing. NVIDIA is powering the growth of AI from the data center to the edge. Shares detracted due to inventory right sizing in NVIDIA’s gaming segment coupled with the broader market sell-off in growth stocks. Given NVIDIA’s end-to-end AI platform and its leading market share in gaming, data centers, and autonomous machines, along with the size of these markets, we believe the company can sustain its growth trajectory. See further discussion of NVIDIA in the top net purchases section below.
During the third quarter, we took advantage of its stock sell-off to add to NVIDIA Corporation, a fabless semiconductor mega cap that is a global leader in gaming cards and accelerated computing hardware and software. The sell-off was driven by a near-term inventory correction in gaming as a result of a COVID-related pull forward in demand as well as the shift in the Ethereum cryptocurrency from proof-of-work to proof-of-stake. Additionally, investors are concerned over the potential slowdown in data center revenues as a result of a weaker macroeconomic environment as well as the recently announced limitations on semiconductor shipments to China. Despite the near-term uncertainty, we believe that NVIDIA’s end-to-end AI platform and its leading market share in gaming, data centers, and autonomous machines, along with the size of these markets, would enable the company to benefit from durable growth for years to come and therefore view the stock price where we added shares as a compelling value for long-term investors. With demand for computing power doubling every one to two years, and Moore’s Law slowing down, there is more need for computing than ever. At the same time, “near free” supply growth (that was possible thanks to Moore’s Law) has slowed dramatically. NVIDIA’s accelerated architecture, with parallel computing at scale, answers that need.”
NVIDIA Corporation (NASDAQ:NVDA) is in 28th position on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 84 hedge fund portfolios held NVIDIA Corporation (NASDAQ:NVDA) at the end of the second quarter which was 102 in the previous quarter.
We discussed NVIDIA Corporation (NASDAQ:NVDA) in another article and shared the top 12 ESG companies in 2022. In addition, please check out our hedge fund investor letters Q3 2022 page for more investor letters from hedge funds and other leading investors.
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