Baron Funds, an investment management company, released its “Baron Real Estate Fund” first quarter 2025 investor letter. A copy of the letter can be downloaded here. In Q1 2025, stocks were sold due to economic growth slowdown, inflation, and policymaking issues, including Baron Real Estate Fund®, without considering value. The fund declined 6.69% (Institutional Shares) in the quarter compared to a 3.11% decline for the MSCI USA IMI Extended Real Estate Index (the MSCI Real Estate Index) and a 0.76% gain for the MSCI US REIT Index (the REIT Index). 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 Real Estate Fund highlighted stocks such as Wynn Resorts, Limited (NASDAQ:WYNN). Wynn Resorts, Limited (NASDAQ:WYNN) owns and operates resorts that operates through Wynn Palace, Wynn Macau, Las Vegas Operations, and Encore Boston Harbor segments. The one-month return of Wynn Resorts, Limited (NASDAQ:WYNN) was 30.39%, and its shares gained 0.39% of their value over the last 52 weeks. On May 14, 2025, Wynn Resorts, Limited (NASDAQ:WYNN) stock closed at $97.49 per share with a market capitalization of $10.19 billion.
Baron Real Estate Fund stated the following regarding Wynn Resorts, Limited (NASDAQ:WYNN) in its Q1 2025 investor letter:
“Wynn Resorts, Limited (NASDAQ:WYNN) is the preeminent luxury global owner and operator of integrated resorts (hotels and casino resorts). We are bullish on the prospects for the company’s development of the Wynn Al Marjan Island in the UAE (expected to open early in 2027). We believe the UAE is the most exciting new market for integrated resort developments in decades.
At its recent price of only $70 per share, the shares are valued at only 7.2 times 2025 estimated cash flow versus a long-term average multiple of 13 to 15 times cash flow. We believe Wynn is trading at an unrealistic discounted multiple with very little value being ascribed to Wynn’s Macau operating assets and its UAE development project. Wynn’s management agrees as they have been buying back shares as has Tilman Fertitta, a highly successful hotel, casino, and entertainment executive, who has acquired more than $1 billion of Wynn shares and is now the largest shareholder of Wynn with a 12% stake in the company.
Wynn Resorts, Limited is the preeminent luxury global owner and operator of integrated resorts (hotels and casino resorts). The company has developed “best-in-class” real estate assets in Las Vegas (Wynn and Encore), Boston (Encore Boston Harbor), and Macau (Wynn Macau and Wynn Palace). The company continues to invest in its hotel and casino assets to maintain its lead in each market.
We are also bullish on the prospects for the company’s newest development – the Wynn Al Marjan Island in the UAE (expected to open early in 2027). We believe the UAE is the most exciting new market for integrated resort developments in decades…” (Click here to read the full text)
Aerial view of a luxury hotel tower surrounded by lush green landscaping.
Wynn Resorts, Limited (NASDAQ:WYNN) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 64 hedge fund portfolios held Wynn Resorts, Limited (NASDAQ:WYNN) at the end of the fourth quarter which was 52 in the previous quarter. While we acknowledge the potential of Wynn Resorts, Limited (NASDAQ:WYNN) 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 Wynn Resorts, Limited (NASDAQ:WYNN) and shared stock predictions that Jim Cramer got completely wrong. In its Q4 2024 investor letter, Nightview Capital highlighted five transformative trends shaping 2025 and beyond, along with an analysis of key companies within its investment universe. Wynn Resorts (NASDAQ: WYNN) was among the featured firms. In addition, please check out our hedge fund investor letters Q1 2025 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.
