Baron Funds, an investment management company, has released its investor letter for the third quarter of 2023. You can download a copy of this here. This year’s technology-driven market rally came to a halt in the third quarter. Against this backdrop, the Baron Asset Fund fell 4.42% (institutional stocks) in the third quarter, outperforming the -5.22% return of the Russell Midcap Growth Index. Positive stock selection and tailwinds from style bias drove the outperformance in the quarter. Another notable factor was the Fund’s underexposure to higher beta stocks, which underperformed during the market turnaround. Plus, take a look at the fund’s top five investments to find out what the best choices are in 2023.
Baron Asset Fund highlighted stocks like Guidewire Software, Inc. (NYSE:GWRE) in its Q3 2023 investor letter. Guidewire Software, Inc. (NYSE:GWRE), headquartered in San Mateo, California, is a company that provides software products for property and casualty insurers. On November 10, 2023, shares of Guidewire Software, Inc. closed. (NYSE:GWRE) at $91.09 per share. The one-month return of Guidewire Software, Inc. (NYSE:GWRE) was 2.03%, and the shares have gained 49.50% of their value over the past 52 weeks. Guidewire Software, Inc. (NYSE:GWRE) has a market cap of $7.463 billion.
Baron Asset Fund made the following comment about Guidewire Software, Inc. in its Q3 2023 investor letter. (NYSE:GWRE):
“Shares of software supplier for non-life insurance Guidewire Software, Inc. (NYSE:GWRE) rose after the company reported robust quarterly results. Sales results include 17 deals for cloud-based software implementations; Eleven of these were with Tier 1 insurers, including AllState Canada, Progressive and Insurance Australia Group, the largest insurer in Australia. We expect the company’s consistent annual revenue growth to accelerate next year as sales momentum continues and existing deals move to higher levels. We are also encouraged by Guidewire’s gross margin growth, which improved nearly 10% last quarter. We believe Guidewire will be the critical software provider to the global property and casualty insurance industry, capturing 30% to 50% of the total addressable market of $15 billion to $30 billion and generating margins in excess of 40%.”
An insurance adjuster who reviews images and paperwork to process a claim.
Guidewire Software, Inc. (NYSE:GWRE) isn’t on our list of the 30 most popular stocks among hedge funds. According to our database, 36 hedge fund portfolios held Guidewire Software, Inc. at the end of the second quarter. (NYSE:GWRE), up from 40 in the previous quarter.
We discussed Guidewire Software, Inc. (NYSE:GWRE) in another article and shared Conestoga Mid Cap Strategy’s thoughts on the company. Additionally, check out our letters to hedge fund investors Q3 2023 page for more investor letters from hedge funds and other leading investors.
Disclosure: None. This article was originally published on Insider Monkey.