Ruane, Cunniff & Goldfarb, an investment adviser managing Sequoia Fund, released its Q4 2023 investor letter. A copy of the same can be downloaded here. In the fourth quarter, the fund returned 13.31% compared to an 11.69% return for the S&P 500 Index. The fund generated a 27.83% return in 2023 compared to a 26.29% return for the index. In addition, you can check the top 5 holdings of the fund to know its best picks in 2023.
Sequoia Fund featured stocks like SAP SE (NYSE:SAP) in the fourth quarter 2023 investor letter. Headquartered in Walldorf, Germany, SAP SE (NYSE:SAP) is an enterprise application software products provider. On March 20, 2024, SAP SE (NYSE:SAP) stock closed at $190.38 per share. One-month return of SAP SE (NYSE:SAP) was 4.78%, and its shares gained 53.85% of their value over the last 52 weeks. SAP SE (NYSE:SAP) has a market capitalization of $222.217 billion.
Sequoia Fund stated the following regarding SAP SE (NYSE:SAP) in its fourth quarter 2023 investor letter:
“After following SAP SE (NYSE:SAP) for many years, we bought shares in the company in 2022. Since we have not covered SAP in much detail in prior communications, we will start with a little background. This Germany-based company boasts the leading global share in enterprise resource planning (ERP) software, or what one might consider the operating system for large businesses. This type of software performs critical functions for customers, related to bookkeeping, manufacturing, and supply chain. SAP also sells complementary modules that help customers manage human resources, procurement, and expenses. For multinational enterprises that make or move something in the physical world, SAP is just about the only game in town. As a result, SAP has retained many of its customers, particularly its biggest ones, for decades.
A handful of years ago, SAP set about transitioning its core ERP software product suite from one typically run by customers on their premises to a cloud version delivered directly by SAP. Because SAP is taking on a much higher degree of responsibility in addition to delivering an upgraded product, it stands to earn substantially more revenue per customer in the cloud. We believe the cloud transition of SAP’s ERP business is likely to usher in a potentially decade-long sweep of accelerated revenue growth. Critically, because SAP’s ERP software is so sticky, the migration to the cloud product is, in our view, much more a matter of when, not if, for a substantial portion of the company’s installed base. We can think of few companies in the world whose products are more essential to their customers and/or have higher switching costs…” (Click here to read the full text)
An executive in suit presenting a large touch screen of the company’s cloud-based enterprise platform.
SAP SE (NYSE:SAP) is not on our list of 30 Most Popular Stocks Among Hedge Funds. At the end of the fourth quarter, SAP SE (NYSE:SAP) was held by 22 hedge fund portfolios, up from 17 in the previous quarter, according to our database.
We discussed SAP SE (NYSE:SAP) in another article and shared the list of European stocks liked by Jim Cramer. 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.
