Baron Funds: “We Believe Boyd (BYD) is a Compelling Acquisition Target”

Baron Funds, an asset management company, released its “Baron Real Estate Fund” second quarter 2022 investor letter. A copy of the same can be downloaded here. Baron Real Estate Fund (the “Fund”) declined 20.62% (Institutional Shares) in the second quarter of 2022, underperforming its primary benchmark, the MSCI USA IMI Extended Real Estate Index (the “MSCI Real Estate Index”), which declined 17.12%. The Fund underperformed the MSCI US REIT Index (the “REIT Index”), which declined 17.16%. In addition, you can check the top 5 holdings of the fund to know its best picks in 2022.

In its Q2 2022 investor letter, Baron Real Estate Fund mentioned Boyd Gaming Corporation (NYSE:BYD) and explained its insights for the company. Founded in 1975, Boyd Gaming Corporation (NYSE:BYD) is a Las Vegas, Nevada-based gaming and hospitality company with a $5.8 billion market capitalization. Boyd Gaming Corporation (NYSE:BYD) delivered a -16.78% return since the beginning of the year, while its 12-month returns are down by -8.42%. The stock closed at $54.57 per share on September 14, 2022.

Here is what Baron Real Estate Fund has to say about Boyd Gaming Corporation (NYSE:BYD) in its Q2 2022 investor letter:

Boyd Gaming Corporation is one of the largest and most successful casino entertainment companies in the U.S. The company owns and operates 28 casino gaming properties in 10 states with a large presence in Las Vegas. Business conditions have been strong, yet the shares are valued at only 6 times 2022 estimated cash flow versus a long-term average of more than 9 times cash flow. The company maintains a strong and liquid balance sheet. Insiders own approximately 27% of the company. We believe Boyd is a compelling acquisition target.”

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Our calculations show that Boyd Gaming Corporation (NYSE:BYD) fell short and didn’t make it on our list of the 30 Most Popular Stocks Among Hedge Funds. Boyd Gaming Corporation (NYSE:BYD) was in 35 hedge fund portfolios at the end of the second quarter of 2022, compared to 40 funds in the previous quarter. Boyd Gaming Corporation (NYSE:BYD) delivered a 2.58% return in the past 3 months.

In May 2022, we also shared another hedge fund’s views on Boyd Gaming Corporation (NYSE:BYD) 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.