Baron Funds, an investment management company, released its “Baron Real Estate Fund” first quarter 2024 investor letter. A copy of the same can be downloaded here. The fund had a strong performance in the quarter and generated a gain of 8.28% (Institutional Shares). The Fund beat both the MSCI US REIT Index (the REIT Index), which declined 0.62% and the MSCI USA IMI Extended Real Estate Index (the MSCI Real Estate Index), which rose 6.59%, respectively. In addition, please check the fund’s top five holdings to know its best picks in 2024.
Baron Real Estate Fund featured stocks like Vulcan Materials Company (NYSE:VMC) in the first quarter 2024 investor letter. Headquartered in Birmingham, Alabama, Vulcan Materials Company (NYSE:VMC) is a construction aggregates producer and supplier. On April 24, 2024, Vulcan Materials Company (NYSE:VMC) stock closed at $256.40 per share. One-month return of Vulcan Materials Company (NYSE:VMC) was -5.73%, and its shares gained 48.74% of their value over the last 52 weeks. Vulcan Materials Company (NYSE:VMC) has a market capitalization of $34.006 billion.
Baron Real Estate Fund stated the following regarding Vulcan Materials Company (NYSE:VMC) in its first quarter 2024 investor letter:
“We added to our position in Vulcan Materials Company (NYSE:VMC) during the most recent quarter. Vulcan is a real estate-related company that is the largest construction aggregates producer in the U.S. Vulcan generates approximately 90% of its gross profit from mining, processing, and transporting crushed stone, sand, and gravel (collectively, “aggregates”) from its quarries. The balance of its gross profit is derived from strategically located ready-mix concrete and asphalt. The company’s products are sold and utilized in infrastructure projects such as highways, as well as residential and non-residential construction. Vulcan has local leadership positions across its footprint.
We believe aggregates are an attractive business for two main reasons: • High barriers to entry limit new competition: Permits to open new quarries are difficult to obtain, and the approval process typically takes 5 to 10 years • Consistent pricing power through cycles: Aggregates producers have historically enjoyed great pricing power owing to the difficulty in opening competing new quarries, the limited substitutes for quality aggregates, and a high weight-to-price ratio that makes transportation expensive relative to the cost of the material. In the last 30 years, pricing of aggregates has increased, on average, 4% per year…” (Click here to read the full text)
A construction site with a truck and crane unloading the company’s materials.
Vulcan Materials Company (NYSE:VMC) is not on our list of 30 Most Popular Stocks Among Hedge Funds. At the end of the fourth quarter, Vulcan Materials Company (NYSE:VMC) was held by 41 hedge fund portfolios, compared to 42 in the previous quarter, according to our database.
We previously discussed Vulcan Materials Company (NYSE:VMC) in another article, where we shared the list of largest manganese mining companies and best manganese stocks to buy. In addition, please check out our hedge fund investor letters Q1 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.
