Review and Outlook

as of 03/31/21

The Review and Outlook for period ending March 31, 2021, is not yet available.

Top Contributors/Detractors to Performance

as of 03/31/21

Contributors

  • Shares of regional casino operator Red Rock Resorts, Inc. increased on sequential revenue growth and sustained margin improvement across its casinos as well as progress on its non-core land sales. Management has reported that it expects to beat its target of four times net leverage over the next two years, which should give the company greater financial flexibility to invest in its assets and pursue deals as they become available.
  • Colony Capital, Inc. is a REIT that is undergoing a multi-year business transformation to become a pure play owner of digital infrastructure real estate (including towers, data centers, and fiber). Strong performance was driven by several steps the company took to accelerate its business transformation, including non-core dispositions, core acquisitions, and fundraising. We believe Colony's eventual transformation to a digital infrastructure REIT will generate a higher multiple and remain investors. 

Detractors

  • Alexandria Real Estate Equities, Inc. is a REIT that owns life science office real estate. After a strong 2020, the stock gave up some gains in concert with a broader market rotation away from secular growth companies such as Alexandria towards companies with cyclically depressed cash flows. In addition, Alexandria issued a modest amount of equity during the quarter to fund accretive acquisitions. We believe the company is positioned to benefit from the aging U.S. population, ongoing health care needs, new drugs, and more capital infusions into biotechnology and health care. 
  • 21Vianet Group, Inc. is an operator of retail colocation data centers in China.  The stock was a detractor during the first quarter due to the broader market rotation from growth to value, rising interest rates, and a broad sell-down in China technology-related companies. We have exited our position in favor of investment opportunities in similar companies with a superior risk/reward profile, in our view.

Investors should consider the investment objectives, risks, and charges and expenses of the investment carefully before investing. The prospectus and summary prospectuses contain this and other information about the Funds. You may obtain them from the Funds’ distributor, Baron Capital, Inc., by calling 1-800-99BARON or visiting www.BaronFunds.com. Please read them carefully before investing.

The performance data quoted represents past performance. Past performance is no guarantee of future results. The investment return and principal value of an investment will fluctuate; an investor's shares, when redeemed, may be worth more or less than their original cost. The Fund’s transfer agency expenses may be reduced by expense offsets from an unaffiliated transfer agent, without which performance would have been lower. Current performance may be lower or higher than the performance data quoted.

Risks:All investments are subject to risk and may lose value.

The discussion of market trends is not intended as advice to any person regarding the advisability of investing in any particular security. The views expressed on this page reflect those of the respective writer. Some of our comments are based on management expectations and are considered “forward-looking statements.” Actual future results, however, may prove to be different from our expectations. Our views are a reflection of our best judgment at the time and are subject to change at any time based on market and other conditions and Baron has no obligation to update them

Portfolio holdings are subject to change. Current and future portfolio holdings are subject to risk.

The index performance is not fund performance; one cannot invest directly into an index.