Baron Funds, an investment management company, released its “Baron Opportunity Fund” third quarter 2024 investor letter. A copy of the letter can be downloaded here. In the third quarter, the fund rose 4.04% (Institutional Shares), outperformed the Russell 3000 Growth Index, which gained 3.42%, and lagged the S&P 500 Index, which advanced 5.89%. In the first nine months ended 2024, the fund posted solid gains, rising 25.31% compared to a 24.00% return for the Russell 3000 Growth Index and beating the S&P 500 Index’s 22.08% gain. Due to a significant rotation away from large-cap Magnificent Seven stocks and toward value/cyclical and small-cap stocks, as well as generally positive economic data that supported the soft-landing narrative and the Federal Reserve’s long-awaited dovish pivot, U.S. stocks ended the quarter higher for the fourth consecutive quarter. In addition, you can check the fund’s top 5 holdings to determine its best picks for 2024.
Baron Opportunity Fund highlighted stocks like Mobileye Global Inc. (NASDAQ:MBLY), in the third quarter 2024 investor letter. Mobileye Global Inc. (NASDAQ:MBLY) develops and implements advanced driver assistance systems (ADAS) and autonomous driving technologies and solutions. The one-month return of Mobileye Global Inc. (NASDAQ:MBLY) was -13.06%, and its shares lost 64.31% of their value over the last 52 weeks. On October 24, 2024, Mobileye Global Inc. (NASDAQ:MBLY) stock closed at $12.51 per share with a market capitalization of $10.195 billion.
Baron Opportunity Fund stated the following regarding Mobileye Global Inc. (NASDAQ:MBLY) in its Q3 2024 investor letter:
“Shares of Mobileye Global Inc. (NASDAQ:MBLY), a provider of ADAS and autonomous driving technologies for the automotive industry, detracted from performance. Excess inventory among key customers proved to be a headwind to growth earlier in the year. Mobileye also experienced a significant decline in market share in China as local original equipment manufacturers shifted to domestic suppliers and in-house technology. Although this was an embedded risk, it materialized faster than expected and included market share losses at key customers. While we maintain our belief in the size and strategic importance of the autonomous vehicle market (see Tesla above), we decided to exit our Mobileye position during the quarter and book a tax loss.”
A driverless vehicle navigating city traffic, equipped with ADAS and safety features.
Mobileye Global Inc. (NASDAQ:MBLY) is not on our list of 31 Most Popular Stocks Among Hedge Funds. As per our database, 28 hedge fund portfolios held Mobileye Global Inc. (NASDAQ:MBLY) at the end of the second quarter which was 34 in the previous quarter. While we acknowledge the potential of Mobileye Global Inc. (NASDAQ:MBLY) as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is as promising as NVIDIA but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
In another article, we discussed Mobileye Global Inc. (NASDAQ:MBLY) and shared the list of worst performing stocks to buy on the dip. Baron fund expressed its confidence in Mobileye Global Inc.’s (NASDAQ:MBLY) growth prospects in the Q1 2024 investor letter and increased its holdings in the portfolio. In addition, please check out our hedge fund investor letters Q3 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.