Ron Baron

Ron Baron

Last Update: 06-10-2016

Number of Stocks: 296
Number of New Stocks: 23

Total Value: $18,898 Mil
Q/Q Turnover: 5%

Countries: USA
Details: Top Buys | Top Sales | Top Holdings  Embed:

Ron Baron Watch

  • CEO of CarMax Thomas Folliard Sold 271,435 Shares of Company on July 19

    Thomas Folliard (Insider Trades), CEO of CarMax Inc. (KMX), sold 271,435 shares of the company on July 19. The average price per share was $55.39, for a total transaction of $15.03. CarMax Inc. is a U.S. used vehicle retailer headquartered in Richmond, Virginia. The company has a market cap of $11.02 billion.

    The number of insider sells increased from four transactions of 164,920 shares in 2013, to 27 transactions totaling 1,942,070 shares in 2014. In the following year, the number and volume of KMX insider sells decreased to 22 transactions totaling 829,762 shares. There were 12 insider sells totaling 44,559 shares in 2016 to date.


  • CEO of Glaukos Trades Portion of Stake in Company

    Thomas Burns (Insider Trades), CEO of Glaukos Corp. (GKOS), sold 162,254 shares for $30.07 per share on July 13 for a total transaction of $4,878,978.

    The sale left Burns with a stake of 859,495 shares.


  • Guru Holdings That Outperform the S&P 500

    The following are some of the stocks that outperformed the Standard & Poor's 500 Index over the last 12 months and were bought by gurus during the fourth quarter.

    Neogen Corp. (NEOG), with a market cap of $2.11 billion, has outperformed the S&P 500 by 18.5% during the last 12 months. Currently three gurus are holding shares in the company that has returned 3%-plus year to date and 83%-plus during the last five years; it is now trading with a P/E (ttm) ratio of 58.81. According to the DCF calculator, it looks overpriced by 178% at $65.45. Over the last 12 months the company’s revenue has grown by 13% and EPS has grown by 13%.


  • Baron Funds Comments on Equinix

    Equinix, Inc. (EQUIX), the leading provider of Internet Business Exchanges, is an example of a platform company in the Financials sector. Early on, Equinix employed its scale and “network neutral” policy, which allows customers to connect with one another, to attract large telecom networks. Once Equinix established its leading market position, other telecoms, major enterprises, and e-commerce and cloud computing companies felt compelled to join the Equinix “ecosystem” to easily and efficiently access these networks.

    Equinix is a beneficiary of continued growth in Internet traffic, globalization of financial markets, IT outsourcing, cloud computing, and mobility. It converted to a REIT in 2015 (and was moved from the IT to the Financials sector – another example of miscategorization). Earlier this year, Equinix acquired TelecityGroup, making it the largest European data center provider. It also acquired a Japanese data center provider and a firm with technical expertise in migrating customers from legacy data center infrastructure to a hybrid one in which Equinix acts as the intermediary between the enterprise IT shop and the cloud.


  • Baron Funds Comments on Illumina Inc.

    Illumina, Inc. (NASDAQ:ILMN) is a health care company that is the leader in platforms used for DNA sequencing, the process of determining the precise order of nucleotides with a DNA molecule. Illumina provides the tools used for over 90% of the world’s sequencing output. Illumina is benefiting from a major shift into personalized medicine driven by DNA sequencing. It is already becoming common practice to sequence a cancerous tumor and prescribe drugs targeting the genetic mutations specific to that cancer. In the reproductive health arena, DNA sequencing is being used to help identify chromosomal abnormalities early in a pregnancy.

    When we bought Illumina in 2011, the stock had been decimated by two missed quarters, reduced guidance, and the threat of a government shutdown (at the time, roughly one-third of revenue was from academic research, which relies on federal funding). None of this had to do with Illumina’s competitive advantages or potential growth opportunities. We took advantage of the selloff to establish a position. The stock has appreciated more than 300% in the time we have owned it.


  • Ron Baron's Stocks With Highest Returns

    Ron Baron (Trades, Portfolio) is the founder of Baron Capital Management. He is co-portfolio manager of Baron Asset Fund and remains portfolio manager of the Growth and Partners Funds. He manages a portfolio composed of 296 stocks with a total value of $18.898 billion.

    Gaming and Leisure Properties Inc. (GLPI)


  • Baron Funds Comments on

    Ask your typical investor to name the Walmart online, and many will reflexively say, Inc. (NASDAQ:AMZN) In one very narrow sense, we agree with that description. Amazon has been successful at attaining its original goal. Last year, it became the fastest company to reach $100 billion in annual sales, and it is now the world’s largest online retailer. But we think of Amazon as much more than that.

    Take, for instance, Amazon Web Services, the cloud computing business that reached $10 billion in annual sales last year – a pace faster than the original Amazon. There’s also Amazon Prime, with 60 to 80 million members, the Kindle and other electronic devices, streaming videos with proprietary original content, and an online marketplace used by more than 70,000 third-party sellers. Amazon Logistics Services is starting to compete in the trillion-dollar freight industry. Most recently, it introduced its grocery delivery service AmazonFresh. Practically every month, it seems, Amazon unveils a new innovation, product, or service.


  • Baron Funds Comments on Facebook

    Facebook (NASDAQ:FB), the world’s largest social network, in our view is the largest beneficiary of the shift in consumer engagement to mobile. Mobile is no longer a device or an application. It has become a way of life. About four years ago, we participated in Facebook’s IPO at $38 per share. As user engagement transitioned from desktop to mobile, growth slowed and the stock collapsed. We thought Facebook was a unique company with real competitive advantages and viewed mobile monetization as a question of “when” rather than “if.” Market overemphasis on short-term results allowed us to build our position at an average cost of $26 per share. Facebook is currently trading at $114, or three times our initial investment.

    We think Facebook will continue to grow. It is using its leadership position to offer targeted advertising capabilities at scale. The company is in the early stages of monetizing online video and Instagram, which have begun to contribute to incremental revenue growth. WhatsApp and Oculus provide additional avenues for potential growth opportunities.


  • Baron Funds Comments on Alphabet

    Alphabet (NASDAQ:GOOGL) is the world’s dominant search engine. In our view, Alphabet also happens to be one of the most innovative companies on Earth, with a vast array of initiatives and businesses ranging from YouTube to Calico (its foray into longevity). The company’s core business is a powerful platform that benefits from the network effect, economies of scale, and formidable barriers to entry. Most advertisers want to work with Alphabet. Data is becoming increasingly important, and Alphabet owns the most data of any company we know. We believe the value of that data and its monetization opportunities will become more apparent over time. The company is the Fund’s second largest holding, and the value of our investment has doubled in the time we have owned it. As big as it has become, we think Alphabet has a long and robust growth trajectory ahead.

    From Baron Funds' Summer 2016 Newsletter.


  • A Distinctive Approach to Large Cap Growth Investing: Baron Funds Summer Newsletter

    The large cap equity market is widely viewed as a bulwark of every well-balanced investment portfolio. The thinking among investors is that a large cap allocation functions as ballast, given the perceived relative stability inherent in most big, well-established companies. This reasoning, combined with the belief that the efficiency of this asset category makes it especially challenging for active managers to beat the benchmark, tends to steer many large cap investors toward passive investment vehicles.

    While we understand the thinking behind passive investing in the large cap category, its emphasis is on the lower-growth, dividend-generating stocks that dominate the space. For a smart, targeted approach to growth investing in large cap equities, we believe an actively managed fund such as Baron Fifth Avenue Growth Fund is the better choice.


  • Companies Record 5-Year Lows

    According to GuruFocus' list of five-year lows, these guru stocks have reached their five-year lows: Ralph Lauren Corp. (NYSE:RL), BorgWarner Inc. (NYSE:BWA), HollyFrontier Corp. (NYSE:HFC) and Dana Holding Corp. (NYSE:DAN).

    Ralph Lauren reached $88.81


  • Under Armour's P/S Ratio Near Its 10-Year Low

    Under Armour Inc. (NYSE:UA) is traded at P/S ratio of 3.66, close to its 10-year low of 3.56. The company is owned by eight gurus.

    Under Armour has a market cap of $16.74 billion; its shares were traded around $38.32 with a P/E ratio of 64.64 and P/S ratio of 3.67. Under Armour had an annual average earnings growth of 23.50% over the past 10 years. GuruFocus rated Under Armour the business predictability rank of 5-star.


  • Conflicting Views Exist About the Tesla-SolarCity Acquisition

    Tesla Motors Inc. (NASDAQ:TSLA) announced an all-stock merger with SolarCity Corp. (NASDAQ:SCTY) for $2.8 billion on June 21.

    This deal provoked conflicting views among the CEO, analysts and investors. Although the acquisition appears to benefit the two companies in terms of synergies, the deal has an overall negative financial impact.


  • Ron Baron: Under Armour Set to Grow, Netflix a Mistake

    Ron Baron (Trades, Portfolio), founder of Baron Funds, said he has made 10-12 times his money and bought Under Armour (NYSE:UA) as its gone down. He believes the stock will go from $5 billion to $20 billion in 8-10 years with a good profit margin like Nike (NYSE:NKE) and Amazon (NASDAQ:AMZN). He also said he misunderstood Netflix (NASDAQ:NFLX) so he sold it at $80, right before it increased sharply.


  • Ron Baron: Stocks Are Cheap Right Now

    Ron Baron (Trades, Portfolio), founder of Baron Funds, told CNBC Tuesday that previous market corrections have made investors scared. He also holds the less popular opinion that stocks are cheap as a result although the S&P 500 is near an all-time high:

  • Baron Funds Comments on China Everbright Ltd.

    China Everbright Ltd. (SHSE:601818), an asset management firm that has grown assets under management (AUM) at a 30% CAGR over the last five years, is another example. According to market research firm Oliver Wyman, as of 2013, just 3% of China’s RMB 145 trillion in investable assets was held in mutual funds. As investment constraints for institutional/state-owned investors are relaxed, Chinese households shift from saving to investing, and China pushes to internationalize the RMB, AUM in China are expected to grow from RMB 4 trillion in 2013 to RMB 24 trillion in 2020. In addition, we believe low interest rates driven by the government’s economic stimulus will compel more households to move assets out of traditional, low-yielding products such as savings accounts into professionally managed products. Taken together, we believe these trends represent a massive opportunity for fund managers such as China Everbright.

    From Baron Funds' May 2016 Baron Insight: Investing in Financials.


  • Baron Funds Comments on Credicorp Ltd.

    We invest in Financials companies located overseas through our three international funds. In addition to our traditional investment criteria, we look for companies that are poised to benefit from secular or structural growth opportunities in their regional markets. For instance, we own Credicorp Ltd. (NYSE:BAP), the largest financial services company in Peru, with dominant positions in banking, insurance, and asset management. In addition to a high quality management team and a track record of delivering solid profitability, we think Credicorp stands to benefit from two major secular trends: an increase in banking penetration and favorable demographics. Peru is still vastly underserved in terms of financial services, with a loan/GDP ratio of roughly 27%, among the lowest in Latin America, implying significant room for banks to increase lending. In addition, a population with a young, but increasing, median age; a reduction in poverty levels; and a gradual formalization of the labor force will boost demand for financial services, in our view.

    From Baron Funds' May 2016 Baron Insight: Investing in Financials.


  • Baron Funds Comments on MarketAxess Holdings Inc.

    Technology is also transforming the capital markets. Trading across asset classes continues to migrate away from trading pits and phones to electronic venues. Regulatory changes enacted after the global financial crisis have accelerated this shift as higher capital and liquidity requirements for banks have restricted their ability to act as effective market-makers. MarketAxess Holdings Inc. (NASDAQ:MKTX) operates the dominant electronic platform for trading corporate bonds. We believe the corporate bond market is in the early innings of a secular shift from voice-based trading to electronic trading, and that MarketAxess will be the prime beneficiary of this transition.

    From Baron Funds' May 2016 Baron Insight: Investing in Financials.


  • Baron Funds Comments on Worldpay Group

    London-based Worldpay Group plc (NYSE:WPG) is the largest merchant acquirer in Europe, serving a diverse set of 400,000 merchants across 146 countries in 126 currencies. The company is the dominant player in the attractive U.K. payments market and has a fast growing and highly profitable e-commerce business that’s benefiting from the rapid growth of online commerce.

    From Baron Funds' May 2016 Baron Insight: Investing in Financials.


  • Baron Funds Comments on Vantiv Inc.

    Further down the payments value chain sit merchant acquirers and processors, who act as the “sales and distribution” arm of the payments industry. Acquirers enable merchants to accept credit and debit card payments by connecting them to the various networks. Vantiv, Inc. (NYSE:VNTV) is a leading merchant acquirer and payment processor in the U.S. that directly benefits from growth in consumer spending and the secular shift from cash to electronic payments. The company is gaining share due to investments in integrated payments technology and e-commerce capabilities. A significant industry shift toward chip-based, EMV cards should drive continued strong organic growth, in our view.

    From Baron Funds' May 2016 Baron Insight: Investing in Financials.


  • Baron Funds Comments on Primerica Inc.

    Primerica, Inc. (NYSE:PRI) also serves a growing need for financial planning in an underserved customer segment. The company provides term life insurance and third-party investment products to middle income households that are often ignored by other financial companies. Primerica has a multi-level sales model that positions the company to reach middle income investors in a cost-efficient manner and help them set and achieve their financial goals.

    From Baron Funds' May 2016 Baron Insight: Investing in Financials.


  • Baron Funds Comments on Charles Schwab Corp

    We are also investors in The Charles Schwab Corp. (NYSE:SCHW), a premier discount brokerage firm offering securities brokerage and other financial services to individual investors and independent financial advisors. We have owned this company since 1992, when the stock was trading at a split adjusted price of around $1 per share. Today, it trades at more than 30 times that amount. Despite this impressive growth, we feel the company still has many opportunities ahead. Management’s emphasis on earning customer trust has made it, in our view, a sterling brand. We believe its premium brand and superior services will allow Schwab to continue winning share in its core business. Additionally, the Investor Services division has broadened its offerings to include investment management and advice. Its recently released product, Schwab Intelligent Portfolio, manages a client’s assets for no additional cost by utilizing proprietary product and the Schwab bank. We believe this complimentary service will be difficult for rivals to match and will create sticky and valuable customer relationships.

    From Baron Funds' May 2016 Baron Insight: Investing in Financials.


  • Baron Funds Comments on Financial Engines

    Several of the companies we own service the growing need for investment advice among individual investors. Financial Engines, Inc. (NASDAQ:FNGN) is an advisory service for employees of participating employer retirement plans. While it is the significant market leader, it still has just $115 billion in 401(k) assets under management in a highly fragmented market. Its relationships with plan record keepers provide access to over $3 trillion in assets and its products are applicable to the vast majority of these accounts. We think Financial Engines has a long runway of growth as more plan sponsors provide their employees with access to its products, individual investors utilize its services, and new channels of distribution are opened beyond the retirement space.

    From Baron Funds' May 2016 Baron Insight: Investing in Financials.


  • Baron Funds Comments on First Republic Bank

    We’re also invested in First Republic Bank (NYSE:FRC), which provides banking and wealth management services to affluent customers in urban, coastal markets across the U.S. First Republic was founded 30 years ago, acquired in 2007 by Merrill Lynch (which subsequently merged with Bank of America), and spun off as a separate company again in 2010. First Republic differentiates itself through its singular focus on providing exceptional customer service, resulting in high customer loyalty and superior growth. The bank is well-capitalized and is led by an experienced management team that has demonstrated superior underwriting performance over many years. First Republic’s stock has risen over 160% since its IPO in 2010 as its high-touch business model and affluent customer base have driven strong market share gains.

    From Baron Funds' May 2016 Baron Insight: Investing in Financials.


  • Baron Funds Comments on Arch Capital Group Ltd.

    We own Arch Capital Group Ltd. (NASDAQ:ACGL), a specialty insurance and reinsurance company run by an experienced management team with a successful track record across several insurance cycles. Arch excels at underwriting specialized property & casualty policies and can shift its business mix to target the most profitable areas. The company has a unique compensation system for its underwriters that rewards long-term profitability rather than short-term premium growth. Management has demonstrated excellent underwriting discipline and has returned excess capital to shareholders during soft pricing cycles, allowing Arch to maintain industry-leading returns on equity. Its stock has doubled in the last five years.

    From Baron Funds' May 2016 Baron Insight: Investing in Financials.


  • Baron Insight: Investing in Financials

    The Financials sector has lagged significantly since the 2007-08 financial crisis. As of March 31, 2016, the category was down 14% since its October 9, 2007 peak, compared with the broader market as measured by the Russell 3000 Index, which increased 59%. Many financial companies experienced subdued profitability and growth in the aftermath of the crisis as a result of heightened regulation, fines, and historically low interest rates. Most recently, credit risk in the energy space has weighed on the sector. The decreasing likelihood of near-term U.S. Federal Reserve rate hikes has not helped either.


  • Many of Ron Baron's 1st-Quarter Divestitures Are Overvalued Today

    Ron Baron (Trades, Portfolio) of Baron Funds sold more than 40 stakes in the first quarter. Many of his largest divestitures are overvalued today, according to the DCF Calculator.

    Baron’s most noteworthy sale of the first quarter was the divestiture of his 12,971,289-share stake in ITC Holdings Corp. (NYSE:ITC), the Novi, Michigan-based parent company of ITC Transmission, for an average price of $40.55 per share. The deal had a -2.36% impact on Baron’s portfolio.


  • Tallgrass Energy Partners Insider Adds to Stake

    David Dehaemers Jr. (Insider Trades), CEO and president of Tallgrass Energy Partners LP (TEP), purchased 5,300 shares of the company on May 26. The price per share was $45.11 for a total transaction of $239,083.

    Tallgrass Energy Partners and Tallgrass Energy GP, LP are collectively referred to as Tallgrass Energy. Tallgrass Energy Partners is a limited partnership formed to own, operate, acquire and develop midstream energy assets in North America. Tallgrass Energy provides crude oil transportation to customers in Wyoming, Colorado and surrounding regions through Pony Express, which owns the crude oil pipeline, Pony Express System. Tallgrass Energy has a market cap of $3.18 billion and a P/S ratio of 5.74.


  • Baron Funds Comments on Bristol-Myers Squibb

    After watching and following Bristol-Myers Squibb (NYSE:BMY) for the better part of the last three years we used the weakness in the stock created by the sell-off in the biotech sector to finally initiate a small to medium size position. Bristol specializes in small molecule drugs known as biologics, which are harder for the generic drug companies to replicate, and we are particularly excited about its lead immuno-oncology asset, Opdivo which has shown incredible promise in the treatment of lung cancer, while growing 10-20% month over month since its approval in 2015. Based on our belief in the effectiveness of the PD-1 class drugs, we think there is a high likelihood that Bristol will be able to gain approvals and expand the usage of Opdivo in other types of cancers (melanoma, renal, head and neck, hodgkin’s lymphoma, etc.) and could potentially change the paradigm of cancer’s treatment worldwide.

    From Baron Fifth Avenue Growth Fund first quarter commentary 2016.


  • Baron Funds Comments on Illumina Inc.

    Shares of Illumina, Inc. (NASDAQ:ILMN) detracted from performance in the first quarter. Illumina is the leading provider of DNA sequencing technology to academic and commercial laboratories. Although fourth quarter financial results were solid, management tempered expectations for the first quarter HiSeq X and benchtop instrument sales. We continue to believe Illumina has a long runway for growth, driven by increasing adoption of DNA sequencing in clinical markets such as cancer screening, diagnosis, and treatment.

    From Baron Fifth Avenue Growth Fund first quarter commentary 2016.


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