Here’s Why Roper Technologies (ROP) Shares Increased in Q1

Baron Funds, an investment management company, released its “Baron Asset Fund” first quarter 2025 investor letter. A copy of the letter can be downloaded here. After a strong start to 2025, U.S. equities dropped sharply in late February, with most broad market indexes finishing the quarter down mid- to high single digits. Initially, investors were optimistic about the economy during President Trump’s second term. However, market sentiment shifted due to Trump’s plans for sweeping tariffs on key U.S. trade partners. Additionally, investors tempered their enthusiasm for AI beneficiaries, leading to a sell-off in the Magnificent Seven and other companies within the AI ecosystem. Against this backdrop, Baron Asset Fund had a robust first quarter, returning -2.89% (Institutional Shares) compared to the Russell Midcap Growth Index’s -7.12% return. In addition, please check the fund’s top five holdings to know its best picks in 2025.

In its first-quarter 2025 investor letter, Baron Asset Fund highlighted stocks such as Roper Technologies, Inc. (NASDAQ:ROP). Roper Technologies, Inc. (NASDAQ:ROP) designs and develops software and technology-enabled products and solutions. The one-month return of Roper Technologies, Inc. (NASDAQ:ROP) was -1.86%, and its shares gained 4.11% of their value over the last 52 weeks. On June 12, 2025, Roper Technologies, Inc. (NASDAQ:ROP) stock closed at $572.03 per share, with a market capitalization of $61.502 billion.

Baron Asset Fund stated the following regarding Roper Technologies, Inc. (NASDAQ:ROP) in its Q1 2025 investor letter:

“Within IT, the Fund registered gains from property and casualty (P&C) insurance software vendor Guidewire Software, Inc. and Roper Technologies, Inc. (NASDAQ:ROP), a diversified technology company. Roper owns a portfolio of businesses with market-leading software and technology-enabled products. The company has a high percentage of recurring revenue and maintains high cash returns on investment in defensible niche businesses. Roper’s shares increased as these characteristics proved desirable amid the market rotation into more defensive businesses driven by tariff-related concerns.”

Is Roper Technologies, Inc. (ROP) the Best Technology Dividend Stock to Invest in?

A software engineer hunched over a laptop writing code, embodying the companies technical expertise.

Roper Technologies, Inc. (NASDAQ:ROP) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 46 hedge fund portfolios held Roper Technologies, Inc. (NASDAQ:ROP) at the end of the first quarter, which was 54 in the previous quarter. Roper Technologies, Inc.’s (NASDAQ:ROP total revenue grew 12% to $1.9 billion in the first quarter 2025. While we acknowledge the potential of Roper Technologies, Inc. (NASDAQ:ROP) as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is as promising as NVIDIA but that trades at less than 5 times its earnings, check out our report about the undervalued AI stock set for massive gains.

In another article, we covered Roper Technologies, Inc. (NASDAQ:ROP) and shared Conestoga Capital Advisors’ views on the company. In addition, please check out our hedge fund investor letters Q1 2025 page for more investor letters from hedge funds and other leading investors. While we acknowledge the potential of ROP as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you’re looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

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