Baron Funds, an investment management company, released its “Baron Discovery Fund” first quarter 2023 investor letter. A copy of the same can be downloaded here. The fund was up 11.20% in the first quarter compared to the Russell 2000 Growth Index’s return of 6.07%. The strong performance of holdings in the Information Technology (IT), Industrials, and Consumer Discretionary sectors and the Fund’s higher exposure to the top-performing IT sector led the fund to outperform in the quarter. In addition, please check the fund’s top five holdings to know its best picks in 2023.
Baron Discovery Fund highlighted stocks like CareDx, Inc (NASDAQ:CDNA) in the first quarter 2023 investor letter. Headquartered in South San Francisco, California, CareDx, Inc (NASDAQ:CDNA) focused on discovering, developing, and commercializing diagnostic solutions for transplant patients and caregivers. On May 15, 2023, CareDx, Inc (NASDAQ:CDNA) stock closed at $8.34 per share. One-month return of CareDx, Inc (NASDAQ:CDNA) was -8.05%, and its shares lost 67.02% of their value over the last 52 weeks. CareDx, Inc (NASDAQ:CDNA) has a market capitalization of $478.729 million.
Baron Discovery Fund made the following comment about CareDx, Inc (NASDAQ:CDNA) in its Q1 2023 investor letter:
“We sold our position in CareDx, Inc (NASDAQ:CDNA) after some extremely difficult deliberation. This had been one of our favorite ideas given its market leadership in transplant diagnostics, inexpensive valuation, and solid cash position. However, a very unexpectedly negative notice out of MolDx (which is the CMS-related entity that determines pricing and reimbursement criteria for diagnostic tests) exceeded our worst downside scenarios. The vagueness of the notice from MolDx, combined with the potential for a far reduced paid volume of approved tests for Medicare patients put a dramatic amount of current revenue and profitability at risk. We determined that until the issue is resolved, we could not properly underwrite our investment in the company.”
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CareDx, Inc (NASDAQ:CDNA) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 16 hedge fund portfolios held CareDx, Inc (NASDAQ:CDNA) at the end of the fourth quarter which was 15 in the previous quarter.
We discussed CareDx, Inc (NASDAQ:CDNA) in another article and shared Baron Discovery Fund’s views on the company. In addition, please check out our hedge fund investor letters Q1 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.
