Here’s Why You Should Consider Selling Your GDS Holdings (GDS) Shares

Baron Funds, an asset management firm, published its “Baron Partners Fund” fourth quarter 2021 investor letter – a copy of which can be downloaded here. An increase of 19.54% was delivered by the fund’s institutional shares for the fourth quarter of 2021, outperforming the Russell Midcap Growth Index which gained 2.85%  for the same period. The S&P 500 Index rose 11.03% while the Morningstar Large Growth Category (the “Peer Group”) Average increased 6.91%. Spare some time to check the fund’s top 5 holdings to have a clue about their top bets for 2022.

Baron Partners Fund, in its Q4 2021 investor letter, mentioned GDS Holdings Limited (NASDAQ:GDS) and discussed its stance on the firm. Founded in 2001, GDS Holdings Limited (NASDAQ:GDS) is a Shanghai, China-based IT service management company with a $7.2 billion market capitalization, and is currently spearheaded by its CEO, William Wei Huang. GDS Holdings Limited (NASDAQ:GDS) delivered a -48.32% return since the beginning of the year, while its 12-month returns are down by -72.59%. The stock closed at $24.37 per share on March 15, 2022.  

Here is what Baron Partners Fund has to say about GDS Holdings Limited (NASDAQ:GDS) in its Q4 2021 investor letter:

“The Fund’s Core Growth investments were negatively impacted by the market rotation to value-oriented businesses. Fundamentals for most of our Core Growth holdings remain strong. We exited two positions in this space, which included GDS Holdings Limited. GDS, a Chinese data center, suffered from increased oversight and regulation from the Chinese government. While we still appreciate the long-term prospects for both businesses, we believe the current environment for both is difficult and uncertain.”

Photo by Austin Distel on Unsplash

Our calculations show that GDS Holdings Limited (NASDAQ:GDS) failed to obtain a mark on our list of the 30 Most Popular Stocks Among Hedge Funds. GDS Holdings Limited (NASDAQ:GDS) was in 26 hedge fund portfolios at the end of the fourth quarter of 2021, compared to 24 funds in the previous quarter. GDS Holdings Limited (NASDAQ:GDS) delivered a -47.78% return in the past 3 months.

In November 2021, we also shared another Baron Fund’s Q3 2021 views on GDS Holdings Limited (NASDAQ:GDS) in another article. You can find other letters from hedge funds and prominent investors on our hedge fund investor letters 2021 Q4 page.

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