Baron Funds, an investment management firm, published its fourth quarter 2020 “Baron Asset Fund” investor letter – a copy of which can be downloaded here. A return of 15.14% was recorded by its Retail Shares, and 15.21% by its Institutional Shares in the fourth quarter of 2020, both below its Russell Midcap Growth Benchmark that delivered a 19.02% return but above its S&P 500 index that was up by 12.15% in the same period. You can view the fund’s top 5 holdings to have a peek at their top bets for 2021.
Baron Funds, in their Q4 2020 investor letter, mentioned Ceridian HCM Holding Inc. (NYSE: CDAY) and emphasized their views on the company. Ceridian HCM Holding Inc. is a multinational human capital management software company that currently has a $12.5 billion market capitalization. Since the beginning of the year, CDAY delivered a -20.95% return, but its 12-month gains are still up by 80.31%. As of March 22, 2021, the stock closed at $84.24 per share.
Here is what Baron Funds has to say about Ceridian Ceridian HCM Holding Inc. in their Q4 2020 investor letter:
“Shares of Ceridian HCM Holding Inc., a leader in payroll and workforce management software, contributed to performance in the quarter. New sales of the company’s flagship Dayforce platform already exceed pre-pandemic levels and should accelerate across 2021. We expect Dayforce to generate rapid revenue growth, leading to meaningful gross margin expansion, improved free cash flow conversion, and rapid deleveraging of its balance sheet. We are also excited about the possibility of Dayforce Wallet, a new product that will allow employees access to earned wages on a real-time basis (i.e., at the end of each work day rather than on the traditional once every two week pay cycle).”
Our calculations show that Ceridian HCM Holding Inc. (NYSE: CDAY) does not belong in our list of the 30 Most Popular Stocks Among Hedge Funds. As of the end of the fourth quarter of 2020, Ceridian HCM Holding Inc. was in 26 hedge fund portfolios, compared to 36 funds in the third quarter. CDAY delivered a -14.75% return in the past 3 months.