Baron Global Advantage Fund Thinks it Sold ZoomInfo Technologies (ZI) “Too Slowly”
Baron Funds, an investment management firm, released its “Baron Global Advantage Fund” fourth quarter 2023 investor letter. A copy of the same can be downloaded here. The fund was up 14.8% (institutional shares) in the fourth quarter compared to an 11.0% gain for the MSCI ACWI Index (the Index) and a 12.7% gain for the MSCI ACWI Growth Index, the Fund’s benchmarks. The fund appreciated 25.6% for the full year compared to 22.2% and 33.2% for the benchmarks, respectively. In addition, you can check the top 5 holdings of the fund to know its best picks in 2023.
Baron Global Advantage Fund featured stocks like ZoomInfo Technologies Inc. (NASDAQ:ZI) in the fourth quarter 2023 investor letter. Headquartered in Vancouver, Washington, ZoomInfo Technologies Inc. (NASDAQ:ZI) offers a go-to-market intelligence and engagement platform for sales and marketing teams. On March 4, 2024, ZoomInfo Technologies Inc. (NASDAQ:ZI) stock closed at $16.63 per share. One-month return of ZoomInfo Technologies Inc. (NASDAQ:ZI) was 8.27%, and its shares lost 33.51% of their value over the last 52 weeks. ZoomInfo Technologies Inc. (NASDAQ:ZI) has a market capitalization of $11.334 billion.
Baron Global Advantage Fund stated the following regarding ZoomInfo Technologies Inc. (NASDAQ:ZI) in its fourth quarter 2023 investor letter:
"We were too slow to sell when the probability of a likely thesis change dictated action over inaction. Each investment is like a puzzle. Different pieces are missing in different puzzles. Our process is deliberately slow and is built on collecting and analyzing as much information as possible and building conviction over time. In a highly stressful environment with a wide range of outcomes, a recognized lack of balance with emotions running high, postponing “bad decisions” is often the correct course of action except, when there is evidence of a potential or likely thesis change on the negative side in a bear market. We were often too slow and too timid in running for the exit. For example, when a company’s revenues prove to be less sticky during times of stress despite high average retention rates. ZoomInfo Technologies Inc. (NASDAQ:ZI), the business-to-business (B2B) sales data and software provider readily comes to mind, where we made a mistake selling the stock too slowly, as we did not fully appreciate the extent to which the company oversold unused licenses to its customers, which exacerbated the slowing demand environment, creating a whiplash effect as the license inventory was used up later on, causing revenue growth to decelerate materially."
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ZoomInfo Technologies Inc. (NASDAQ:ZI) is not on our list of 30 Most Popular Stocks Among Hedge Funds. At the end of the fourth quarter, ZoomInfo Technologies Inc. (NASDAQ:ZI) was held by 37 hedge fund portfolios, down from 44 in the previous quarter, according to our database.
We discussed ZoomInfo Technologies Inc. (NASDAQ:ZI) in another article and shared the list of best tech stocks to buy on the dip. In addition, please check out our hedge fund investor letters Q4 2023 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.
