Baron Group, founded by fund manager Ron Baron, recently made a number of changes to its holdings in the fourth quarter of 2019.
When trading gurus and reputable fund managers cut stocks from their portfolio, it’s a sign worth acknowledging. In many cases, you may want to consider making similar changes to your portfolio. However, this should not be taken as definitive and investors are still recommended to conduct their own due diligence.
Continue reading for more details regarding the stocks that this hedge fund cut to close out 2019.
Maximum Inc. (NYSE: MMS) is a government health and human services program operator with a market cap of about $4.50 billion and an enterprise value of nearly $4.60 billion. Baron Funds recently cut its MMS position by just over 66%, resulting in a -0.13% impact on its portfolio.
While Baron Group did cut its position, Maximus does show some promise with a return on equity of 20.17% and return on assets of 13.87%, better than the vast majority of companies in the business services industry.
Other notable shareholders of MMS include Pioneer Investments with 0.34% of outstanding shares and Renaissance Technologies with 0.37%.
A commercial real estate data company, CoStar Group Inc. (NASDAQ: CSGP) has a market cap of $26.24 billion and an enterprise value of $24.99 billion.
Like Maximus, CoStar has strong growth potential with a return on equity of nearly 1% and a return on assets of almost 9%. The company also has a cash-debt ratio of 9.58.
Baron Funds recently cut its position by 5.16% and still holds 6.2% of outstanding shares. Other notable shareholders include Frank Sands with 3.76% and Chuck Akre with 0.68%.
Next, Baron Funds exited its position in Nokia Corporation (NASDAQ: NOK), a telecommunication equipment provider with a market capitalization of over $23 billion and an enterprise value of about $22.5 billion. Baron Funds’ portfolio was impacted by -0.12% following the closing of this position.
The company has a cash-debt ratio of 1.16, return on equity of 0.04%, and return on assets of 0.02% — leaving some room for uncertainty regarding the company’s forward-looking growth potential.
Notable shareholders also include PRIMECAP Management with 0.64% of outstanding shares, John Rogers with 0.32%, and Ken Heebner with 0.14%.
You’re likely already familiar with Expedia Group Inc. (NASDAQ: EXPE), one of the largest online travel agencies in the world with a market cap of $16.82 billion. The company also has an enterprise value of just over $20 billion.
Baron Funds completely exited its position in EXPE, impacting its portfolio by -0.17%. EXPE’s largest shareholders include Renaissance Technologies with 0.65% of outstanding shares, followed by Point72 Asset Management with 0.26%, and Pioneer Investments with 0.24%.
Despite Baron’s decision to exit this position, Expedia shows strong growth potential with a return on equity of 13.66% and return on assets of 2.72%, outperforming more than half of the companies in the travel industry.
Cision Ltd. (NYSE: CISN) is a media communications company with a return on equity of -1.21% and the return on assets of -0.24%, which are below the industry standards. The company also has a market cap of $1.48 billion and an enterprise value of $2.74 billion.
Baron Funds closed its position in CISN in Q4 2019 resulting in a -0.19% impact on the portfolio.
More notable shareholders of CISN include Renaissance Technologies with 0.37% of outstanding shares, GAMCO Investors with 0.11%, and Gotham Asset Management with 0.04%.
Next, Baron cut its position in IDEXX Laboratories (NASDAQ: IDXX) by 3.4%. The company, which specializes in developing and distributing diagnostic products, has a market cap of over $23 billion along with an enterprise value of $24.71 billion.
After dropping its position, Baron’s portfolio was impacted by -0.15%. Other notable shareholders are Pioneer Investments with 0.19% of outstanding shares and Renaissance Technologies with 0.75%.
Lastly, we have Vail Resorts Inc. (NYSE: MTN), a resort and casinos company that was recently trading at $201.40. The resort company has a market cap of just over $10 billion and an enterprise value of about $12.5 billion.
After dropping its position by nearly 5.5%, Baron Funds’ portfolio was impacted by -0.25%. Baron is one of the largest notable shareholders with 11.31% of outstanding shares. This is followed by Diamond Hill Capital with 1.19% and Pioneer Investments with 0.17%.
Article By: Connor Beam