Morningstar (MORN) Fell Due to a Pullback in the Information Services Sector
Baron Funds, an investment management company, released its “Baron FinTech Fund” third-quarter 2025 investor letter. A copy of the letter can be downloaded here. In the third quarter, the fund fell 4.29% (Institutional Shares) compared to a 1.90% decline for the FactSet Global FinTech Index (Benchmark). Since its inception, the fund has appreciated at an annualized rate of 11.10%, compared to a 4.00% return for the Benchmark. The market strength in the quarter was primarily driven by the resumption of Federal Reserve (the Fed) rate cuts and AI optimism. In addition, please check the fund’s top five holdings to know its best picks in 2025.
In its third-quarter 2025 investor letter, Baron FinTech Fund highlighted stocks such as Morningstar, Inc. (NASDAQ:MORN). Headquartered in Chicago, Illinois, Morningstar, Inc. (NASDAQ:MORN) is a leading investment research services provider. On November 15, 2025, Morningstar, Inc. (NASDAQ:MORN) stock closed at $211.95 per share. One-month return of Morningstar, Inc. (NASDAQ:MORN) was -2.86%, and its shares lost 36.61% of their value over the last 52 weeks. Morningstar, Inc. (NASDAQ:MORN) has a market capitalization of $8.801 billion.
Baron FinTech Fund stated the following regarding Morningstar, Inc. (NASDAQ:MORN) in its third quarter 2025 investor letter:
"Morningstar, Inc. (NASDAQ:MORN) is a leading data provider for the investment community. Shares declined alongside a broad-based pullback in information services stocks due to perceived threats from generative AI and a market rotation away from high-quality companies. AI concerns were likely amplified by a modest slowdown in PitchBook, Morningstar’s private markets data and research platform, which still grew revenue by 10% in the recent quarter. We believe these concerns are overdone and expect that Morningstar’s investment data and PitchBook’s proprietary insights will remain highly valuable to clients. We continue to own the stock and expect faster revenue growth with continued margin expansion over time."
Morningstar, Inc. (NASDAQ:MORN) is not on our list of 30 Most Popular Stocks Among Hedge Funds. According to our database, 44 hedge fund portfolios held Morningstar, Inc. (NASDAQ:MORN) at the end of the second quarter, up from 41 in the previous quarter. While we acknowledge the potential of Morningstar, Inc. (NASDAQ:MORN) as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on thebest short-term AI stock.
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