Baron Asset Fund on Gartner
Thesis
Gartner detracted as increasing fears about AI disruption caused its valuation multiple to compress. Baron continues to own the company because of its large addressable market, significant competitive advantage and robust free cash flow generation. The depressed valuation also increases the potential effectiveness of continued share repurchases funded by that cash generation. Baron therefore views AI fears as excessive relative to Gartner's competitive position and financial characteristics.
“We continue to own Gartner given its large addressable market, significant competitive advantage, and robust free cash flow generation”
Key risks
- AI disruption could weaken demand for Gartner's syndicated research products