Baron Funds, an investment management company, released its “Baron Asset Fund” third quarter 2023 investor letter. A copy of the same can be downloaded here. The market rally, which was driven by technology this year, stalled in the third quarter. Against this background, Baron Asset Fund (institutional stocks) fell 4.42% in the third quarter, outperforming the Russell Midcap Growth Index’s return of -5.22%. Positive stock selection and tailwinds from its style disruptions drove the outperformance in the quarter. The fund’s underexposure to higher beta stocks, which underperformed during the market turnaround, was another notable factor. Additionally, check the fund’s top five holdings to know the best picks in 2023.
Baron Asset Fund highlighted stocks like Guidewire Software, Inc. (NYSE:GWRE) in the investor letter in Q3 2023. Guidewire Software, Inc. (NYSE:GWRE) is headquartered in San Mateo, California, and is a software product provider to non-life insurance companies. On November 10, 2023, Guidewire Software, Inc. closed. (NYSE:GWRE) stock at $91.09 a share. One Month Return of Guidewire Software, Inc. (NYSE:GWRE) was 2.03% and its shares increased 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 on Guidewire Software, Inc. (NYSE:GWRE) in its Q3 2023 investor letter:
“Stocks of P&C Software Vendor Guidewire Software, Inc. (NYSE:GWRE) rose after the company announced robust quarterly results. Sales results included 17 deals for cloud-based software deployments; 11 of these were with Tier 1 insurers, including AllState Canada, Progressive and Insurance Australia Group, the largest insurer in Australia. We expect to see the company’s consistent annual recurring revenue growth accelerate next year as sales momentum continues and existing deals ramp up to higher levels. We are also encouraged by Guidewire’s gross margin expansion, which improved nearly 10% over the past quarter. We believe Guidewire will be the critical software supplier to the global P&C industry, capturing 30% to 50% of its total addressable market of $15 to $30 billion and generating margins in excess of 40%.
An insurance adjuster who reviews photos and paperwork to process a claim.
Guidewire Software, Inc. (NYSE:GWRE) is not on our list of 30 most popular stocks among hedge funds. According to our database, 36 hedge fund portfolios held Guidewire Software, Inc. (NYSE:GWRE) at the end of the second quarter, which was 40 in the previous quarter.
We discussed Guidewire Software, Inc. (NYSE:GWRE) in another article and shared Conestoga Mid Cap Strategy’s view on the company. Additionally, please check out our Hedge Fund Investor Letters Q3 2023 page for more investor letters from hedge funds and other leading investors.
Disclosure: None. This article was originally published on Insider Monkey.