Does Globant S.A. (GLOB) Have a Long Runway for Growth?

Baron Funds, an investment management company, released its “Baron Global Advantage Fund” investor letter for the second quarter of 2025. A copy of the letter can be downloaded here. In the second quarter, the fund returned 22.7% (Institutional Shares), compared to the MSCI ACWI Index’s (the Index) 11.5% gain and the MSCI ACWI Growth Index’s 17.3% gain. The Fund is up 11.2%, year-to-date, compared to gains of 10.1% and 9.3% for the benchmarks, respectively. In addition, please check the fund’s top five holdings to know its best picks in 2025.

In its second-quarter 2025 investor letter, Baron Global Advantage Fund highlighted stocks such as Globant S.A. (NYSE:GLOB). Globant S.A. (NYSE:GLOB) is a Luxembourg-based technology services company. The one-month return of Globant S.A. (NYSE:GLOB) was -11.77%, and its shares lost 55.50% of their value over the last 52 weeks. On August 4, 2025, Globant S.A. (NYSE:GLOB) stock closed at $82.03 per share, with a market capitalization of $3.614 billion.

Baron Global Advantage Fund stated the following regarding Globant S.A. (NYSE:GLOB) in its second quarter 2025 investor letter:

"Shares of IT services provider Globant S.A. (NYSE:GLOB) fell 22.8% after the company reported weaker-than-expected financial results and cut guidance. Revenues grew 7% in the first quarter and are expected to slow further given full-year revenue growth guidance of 2%. Management attributed the slowdown to macroeconomic uncertainty, tariffs, and weakness in certain geographies. Globant’s performance had been resilient despite the broader softness in IT services spending, so this slowdown was especially disappointing. We continue to own the stock because we believe Globant has a long runway for growth in a very large global market for IT services."

Globant S.A. (NYSE:GLOB) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 31 hedge fund portfolios held Globant S.A. (NYSE:GLOB) at the end of the first quarter, which was 25 in the previous quarter. Globant S.A. (NYSE:GLOB) reported solid results in Q1 2025, with revenues reaching $611 million, reflecting an 7% year-over-year growth. While we acknowledge the potential of Globant S.A. (NYSE:GLOB) 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 the best short-term AI stock.

In another article, we covered Globant S.A. (NYSE:GLOB) and shared the list of best information technology services stocks to invest in. Alger Mid Cap Focus Fund also cited the same reason for Globant S.A.'s (NYSE:GLOB) decline in its Q2 2025 investor letter. In addition, please check out our hedge fund investor letters Q2 2025 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.