Ron Baron (Trades, Portfolio), founder of investment management firm Baron Capital, recently added more shares of Benefitfocus Inc (BNFT, Financial) and Financial Engines Inc (FNGN, Financial) to his portfolio and reduced shares of Dreamworks Animation SKG Inc (DWA, Financial) and Gartner Inc (IT, Financial). Baron has a total of 357 stocks in his portfolio, with a total value of $24.141 billion.
Baron now owns 343,5622 shares of Benefitfocus Inc (BNFT, Financial), impacting his portfolio by 0.12%. BNFT is currently $28.21 and down by 0.88%. The company provides cloud-based software solutions under a software-as-a-service (SaaS) model.
In previous reports, Baron shared information about the stock's performance in his portfolio. This comes from the Baron Growth Fund Q3 2014 Report: "...Benefitfocus is the leading provider of cloud-based benefits software, offering an integrated suite of solutions to help customers more efficiently shop, enroll, manage, and exchange benefits information. We think Benefitfocus serves an addressable market more than 100 times larger than its current business, which should allow it to compound revenue at more than 30% annually."
We gave the company a financial strength score of 4 our of 10 and a profitability and growth score of 2 out of 10.
BNFT's P/S ratio is 5.70, ranked lower than 68% of the companies in the software-applicaton industry, as outlined in the charts above.
Financial Engines Inc (FNGN, Financial) was founded in 1996 in California and provides portfolio management services, investment advice and retirement income services. Baron added 8.12% of shares, increasing his number of shares to 548,906 and impacting his portfolio by 0.06%.
Baron outlined why he added FNGN in his portfolio in the Baron Growth Fund Q3 2014 Report last quarter: "...We took advantage of its attractive stock price to add to the Fund's Investment and believe its lomg-term investment premise still holds. Financial Engines is the dominant player in a $5 trillion market, with roughly $900 billion in plan assets under contract and $100 billion in assets under management. Significant potential exists to add to these amounts through increased sales to plan sponsors and improved marketing to plan participants and broadening product offerings. Additionally, we believe the company should eventually be able to use its expertise to service the IRA and defined benefit market..."
According to Peter Lynch's chart above, the stock is currently overvalued, priced at $35.07.
We gave the company a financial strength score of 9 and a profitability and growth score of 8 out of 10. The current P/E ratio is 51.15, ranking it higher than 56% of companies in the Global Asset Management industry, as shown in the chart below.
The company's current P/B ratio is 4.85, which is lower than 57% of the companies in the same industry. Its PEG ratio is 1.15 and higher than 93% of the global asset management industry.
Institutional ownership has rapidly declined to 13%, as shown in the chart above.
Other gurus that are currently holding FNGN in their portfolios include: Jim Simons (Trades, Portfolio), Chuck Royce (Trades, Portfolio), Joel Greenblatt (Trades, Portfolio) and RD Investment Management.
Dreamworks Animation SKG Inc (DWA, Financial) was developed in 2004. The company creates animated feature films for family entertainment. Baron recently decreased the amount of shares of this stock by 82.27%, leaving him with a total of 500,000 shares.
According to Lynch, this stock is valued at $5.40, but the current price is $21.72, which means the stock is overvalued.
We gave the company a financial strength score of 6 and a profitability and growth score a 4 out of 10. The P/B ratio is 1.33 and higher than 82% of the 578 companies in the same industry, as shown in the chart below.
According to Baron's letter to shareholders from the first quarter of 2014, "Shares of Dreamworks were down in the first quarter based on slightly lower than anticipated results associated with the movie 'Turbo.' We believe shares will recover based on this summer's upcoming release of the sequel to the blockbuster 'How to Train Your Dragon,' and as the market comes to understand the opportunity for Dreamworks to significantly grow its TV and consumer licensing business going forward."
Other gurus who currently hold Dreamworks in their portfolios are: Mason Hawkins (Trades, Portfolio), Donald Yactman, PRIMECAP Management (Trades, Portfolio), Murray Stahl (Trades, Portfolio), Chuck Royce (Trades, Portfolio) and Steven Cohen (Trades, Portfolio).
Gartner Inc (IT, Financial) was founded in 1979 and is a technology research and advisory company. Baron reduced shares by 1.07%, which had a 0.03% impact on his portfolio and left him with a total of 8,979,967 shares of this stock, which is currently priced at $82.52 and down by 0.91%.
According to Lynch, this stock in undervalued, as shown in the chart above.
We gave the comapny an overall financial strength rating of 8, partially due to the Cash to Debt ratio of 0.92, an F-Score of 7 and a Z-Score of 5.06. Profitability and growth received a score of 9.
IT's P/E ratio is 40.99, which is higher than 69% of the 2280 companies in the same industry. The P/B ratio is currently 47.70.
This stock is also held by gurus Jeremy Grantham (Trades, Portfolio), Chuck Royce (Trades, Portfolio), Pioneer Investments (Trades, Portfolio), Jim Simons (Trades, Portfolio), Joel Greenblatt (Trades, Portfolio) and Steven Cohen.
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