Baron Funds, an investment management company, released its “Baron Discovery Fund” first quarter 2025 investor letter. A copy of the letter can be downloaded here. In the first quarter, the fund was down 6.17% (Institutional Shares), outperforming the -11.12% return for the Russell 2000 Growth Index. The market began strong in February but faded due to Trump’s serious tariff enactment, which the market perceives as inflationary and slowing economic growth. The decline accelerated after April 2nd, causing fears of a trade war and global recession. In addition, please check the fund’s top five holdings to know its best picks in 2025.
In its first-quarter 2025 investor letter, Baron Discovery Fund highlighted stocks such as Wingstop Inc. (NASDAQ:WING). Wingstop Inc. (NASDAQ:WING) is a restaurant company that operates under the brand name Wingstop. The one-month return of Wingstop Inc. (NASDAQ:WING) was 52.30%, and its shares lost 16.13% of their value over the last 52 weeks. On May 16, 2025, Wingstop Inc. (NASDAQ:WING) stock closed at $321.08 per share with a market capitalization of $8.959 billion.
Baron Discovery Fund stated the following regarding Wingstop Inc. (NASDAQ:WING) in its Q1 2025 investor letter:
“During the quarter we “invested in reverse” and initiated a position in Wingstop Inc. (NASDAQ:WING). Wingstop shares have recently underperformed, as following two straight years of very strong same-store sales growth, trends have returned to normalized levels. We took advantage of this opportunity to own this high-quality company at a compelling valuation relative to its growth and margin prospects.
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