Have you ever watched the market chase the latest shiny thing—AI stocks, mega-cap tech—while some truly solid companies get completely ignored? It happens all the time. And right now, in late 2025, one legendary investor thinks that’s creating a rare opening in an unexpected corner of the market.
I’ve followed value-oriented investors for years, and few have the track record of Ron Baron. The guy has turned patient, thoughtful investing into billions in profits for his clients. Recently, he stepped into the spotlight to talk about opportunities most people are overlooking. His message was clear: while everyone piles into technology, some of the best prospects are hiding in plain sight within the financial sector.
Why Ron Baron Is Excited About Forgotten Financial Stocks
Let’s be honest—the financial sector hasn’t exactly been the darling of Wall Street this year. Many names have lagged badly, punished by higher interest rates, slower growth worries, or just plain rotation out of anything that isn’t AI-related. But Baron sees this as classic mispricing. In his view, great businesses led by exceptional people don’t stay cheap forever.
He specifically called out two companies that his firm has owned for years: MSCI and FactSet. These aren’t flashy fintech startups or crypto plays. They’re established, somewhat under-the-radar providers of essential tools and data that the entire investment industry relies on every single day.
What struck me most wasn’t just the stock picks themselves, but how much emphasis Baron placed on leadership. Time and again, he came back to the CEOs—their backgrounds, their drive, their personal investments in the companies. In a world obsessed with algorithms and quarterly numbers, it was refreshing to hear someone with his experience still betting heavily on people.
MSCI: The Index Giant Flying Under the Radar
If you’ve ever invested in an ETF tracking emerging markets or ESG strategies, chances are you’ve indirectly used MSCI’s work. Their indexes are the benchmarks that trillions of dollars follow. Beyond indexes, they offer sophisticated analytics and risk management tools that big institutions can’t function without.
The company came public back in 2007 after being spun out of a major bank. Shares started at $18, climbed, then crashed during the financial crisis. Baron was buying all the way down—and kept buying as it recovered. Today, even after years of strong performance, the stock has pulled back nearly 8% over the past year.
Why does he remain so bullish? A big part is Henry Fernandez, the longtime chairman and CEO. Baron describes Fernandez’s journey with genuine admiration: fleeing political upheaval in Nicaragua, arriving in the U.S. with nothing, building MSCI from inside Morgan Stanley, and then leading it independently.
“He’s been buying shares personally. I’m trying to keep up with him.”
– Ron Baron on Henry Fernandez
That kind of alignment—when the leader is aggressively investing his own money alongside shareholders—is something experienced investors watch for. It signals deep confidence in the future. And in a business with recurring revenue, wide moats, and global reach, Fernandez’s track record gives Baron every reason to stay patient.
Perhaps the most interesting aspect is how embedded MSCI has become. Asset managers, pension funds, hedge funds—they all license MSCI data and indexes. Switching costs are enormous. Once you’re in, you’re in. That creates the kind of predictable, growing cash flow that patient investors dream about.
FactSet: A Tough Year, But a Transformational Leader
FactSet’s story this year has been rougher. Shares are down close to 40% after some disappointing earnings reports and softer guidance. For many investors, that’s reason enough to steer clear. But Baron sees something different: a temporary setback in an otherwise outstanding business, now paired with fresh, world-class leadership.
Like MSCI, FactSet provides critical financial data, analytics, and research platforms to professionals worldwide. Think of it as a serious alternative in a space dominated by private giants. Investment banks, asset managers, and corporate finance teams depend on its workstations and datasets.
The game-changer, according to Baron, arrived in September: new CEO Sanoke Viswanathan. His resume reads like a Hollywood script. Grew up on a farm in India with limited resources. Earned degrees from top engineering schools. Joined a prestigious consulting firm. At just 33, advised U.S. officials during the financial crisis. Then rose rapidly through the ranks at one of the world’s best-run banks, becoming a senior executive under a legendary CEO.
In fact, Baron claims Viswanathan was on the short list to eventually succeed that iconic bank leader—widely considered among the greatest CEOs of our generation. When it became clear the top job would go elsewhere, Viswanathan chose to take the helm at FactSet instead.
“Think about putting a 51- or 52-year-old Jamie Dimon in charge of this company. That’s what just happened.”
– Ron Baron on Sanoke Viswanathan’s appointment
That comparison isn’t thrown around lightly. If you believe leadership is the ultimate differentiator—and decades of market history suggest it often is—then this transition could mark a turning point. A proven operator with crisis experience, strategic vision, and operational excellence now running a high-quality but temporarily out-of-favor business.
Short-term headwinds? Sure. Competition is fierce, growth has slowed, margins faced pressure. But the core franchise remains strong. Clients don’t switch data providers on a whim. And with new leadership focused on innovation and efficiency, Baron believes the current pessimism has created an attractive entry point.
The Bigger Picture: Where the Market Is Looking (and Not Looking)
It’s easy to get caught up in whatever sector is dominating headlines. In 2025, that’s been artificial intelligence and large-cap technology. Massive inflows, soaring valuations, endless media coverage. But markets are cyclical. What’s loved today can cool tomorrow, and what’s ignored can suddenly become the next leader.
Baron’s career has been built on finding those mismatches—great companies trading at reasonable prices because the crowd is elsewhere. He’s done it before with electric vehicles, space exploration, and other disruptive themes when few were paying attention.
Now he’s pointing to financial infrastructure names that power the industry quietly but profitably. These aren’t speculative bets. They’re mature, cash-rich businesses with defensive characteristics and growth potential, led by executives who have skin in the game—literally.
- Recurring revenue models that provide stability
- High barriers to entry and sticky customer relationships
- Global scale serving institutional clients
- Strong balance sheets and shareholder-friendly policies
- Leadership deeply aligned with investors
When you put those qualities together, you get the kind of compounding machines that patient capital loves. The current discounts? They might just be the margin of safety that makes the risk-reward compelling.
What This Means for Everyday Investors
Not everyone has billions to deploy like Baron. But the principles translate. Look beyond the hot sectors. Pay attention to management quality. Seek businesses with durable advantages trading below their intrinsic value.
In my experience, the hardest part is often the waiting. These kinds of ideas rarely explode overnight. They require conviction through periods of underperformance or indifference. But when the narrative shifts—and it usually does—the rewards can be substantial.
Whether you’re building a retirement portfolio, seeking growth alongside income, or simply trying to avoid overpaying for popularity, ideas like these deserve a spot on your watchlist.
At the end of the day, investing is about people as much as numbers. When a seasoned billionaire enthusiastically backs two companies because of the leaders at the helm, it’s worth listening. The market may be distracted today, but history shows that quality eventually gets recognized.
Maybe MSCI and FactSet won’t be tomorrow’s headlines. But over the next decade? In Baron’s view—and increasingly in mine—they could deliver the kind of steady, outsized returns that turn good portfolios into great ones.
The opportunity, as always, lies in seeing what others aren’t—yet.
