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Is it Still Worthy to Own NVIDIA (NVDA) Stock?

·2 min read

Baron Funds, an asset management firm, published its “Baron Durable Advantage Fund” second quarter 2022 investor letter – a copy of which can be downloaded here. Baron Durable Advantage Fund (the “Fund”) declined 15.7% (Institutional Shares) during the second quarter, roughly in line with the 16.1% decline for the S&P 500 Index (the “Index”), the Fund’s benchmark. Year-to-date, the Fund has declined by 24.4% compared to the 20.0% decline for the Index. Go over the fund’s top 5 positions to have a glimpse of its finest picks for 2022.

In its Q2 2022 investor letter, Baron Fifth Avenue Growth Fund mentioned NVIDIA Corporation (NASDAQ:NVDA) and explained its insights for the company. Founded in 1993, NVIDIA Corporation (NASDAQ:NVDA)  is a Santa Clara, California-based multinational technology company with a $348.6 billion market capitalization. NVIDIA Corporation (NASDAQ:NVDA) delivered a -52.43% return since the beginning of the year, while its 12-month returns are down by -36.92%. The stock closed at $139.90 per share on September 08, 2022.

Here is what Baron Fifth Avenue Growth Fund has to say about NVIDIA Corporation (NASDAQ:NVDA)  in its Q2 2022 investor letter:

"At the company-specific level, there was a broad correction across the entire portfolio. While four of our holdings contributed to performance, the contribution to absolute returns was less than 100bps combined, as unfortunately none of them were large enough to move the needle. We had 16 investments detracting over 100bps each with NVIDIA (NASDAQ:NVDA), our second largest detractor, costing the Fund 254bps.

NVIDIA’s stock was hit even harder, down 44.4%, impacted by concerns over the health of the consumer, dramatic declines in crypto, and COVID-related lockdowns in China. Despite the sell-off and the increased near-term volatility in its gaming business, NVIDIA’s revenues grew 46% year-over-year with 48% operating margins, driven by continued strength in its data center business as companies across industries adopt AI and ML..." (Click here to see the full text)


Our calculations show that NVIDIA Corporation (NASDAQ:NVDA)  ranks 27th on our list of the 30 Most Popular Stocks Among Hedge Funds. NVIDIA Corporation (NASDAQ:NVDA)  was in 84 hedge fund portfolios at the end of the second quarter of 2022, compared to 102 funds in the previous quarter. NVIDIA Corporation (NASDAQ:NVDA)  delivered a -22.48% return in the past 3 months.

In August 2022, we also shared another hedge fund’s views on NVIDIA Corporation (NASDAQ:NVDA)  in another article. You can find other investor letters from hedge funds and prominent investors on our hedge fund investor letters 2022 Q2 page.

Disclosure: None. This article is originally published at Insider Monkey.