| ANNUALIZED SINCE INCEPTION | QUARTERLY | YTD |
|---|---|---|
| 10.4% | 4.6% | 19.4% |
| 2025 | 2024 |
|---|---|
| 19.4% | 39.9% |
Baron Opportunity Fund delivered strong performance in Q4 2025, gaining 4.63% versus the Russell 3000 Growth Index's 1.14%, driven by stock picking across innovation and secular growth leaders. The Fund's standout contributor was SpaceX, now the second largest holding, benefiting from rapid Starlink broadband expansion and reusable launch technology progress. AI remains the predominant investment theme, with NVIDIA being a 10-bagger and Broadcom a 2.5-bagger from explosive growth. The Fund maintains high conviction positioning across secular megatrends including AI, space technology, cloud computing, and advanced therapeutics. Key additions included Axon Enterprise for public safety technology, On Holding for athletic footwear, and Heartflow for AI-powered heart disease diagnostics. The manager exited Oracle due to OpenAI concentration concerns and The Trade Desk due to Amazon competitive pressures. With continued Federal Reserve easing and moderating economic pressures, the Fund remains focused on durable, innovation-driven growth opportunities that should deliver solid long-term returns.
Baron Opportunity Fund focuses on powerful secular growth trends that disrupt industries and drive sustained, high-impact, profitable growth opportunities, with transformative trends like AI, space exploration, autonomous transportation, robotics, and advanced therapeutics shaping the future and driving long-term investment returns.
The manager remains confident in and committed to the Fund's strategy of durable growth based on powerful, long-term, innovation-driven secular growth trends. He continues to believe that non-cyclical, durable, and resilient growth should be part of investors' portfolios and that the strategy will deliver solid long-term returns for shareholders.
| Date | Letter | Tickers | Keywords | Pitches | Quick Takes |
|---|---|---|---|---|---|
| Feb 5 2026 | 2025 Q4 | ACLX, AMZN, ARGX, AXON, BRCM, CSGP, DUOL, EXAS, GOOGL, GTLB, HRTX, LLY, META, MSFT, NVDA, ONON, ORCL, SPOT, TSLA, TTD | AI, Cloud, growth, innovation, secular trends, semiconductors, Space, technology | - | AI is the most powerful technology platform shift since the internet, driving stock leadership and returns over the last three years. Baron has investments across… |
| Nov 8 2025 | 2025 Q3 | ANET, AVGO, HTFL, IT, NVDA, PAR, SNPS, SPOT, TEAM, TSLA, TTD | AI, Cloud, compute, innovation, semiconductors |
NEE FFBC NVDA TSLA AVGO TTD IT PAR |
The fund notes unprecedented AI-driven capital spending, including multigigawatt compute commitments and expanding TAM projections across software, semiconductors, and cloud. Managers evaluate AI through multiple… |
| Aug 5 2025 | 2025 Q2 | - | AI, Long-Term Growth, secular trends, US Equities | - | - |
| Mar 31 2025 | 2025 Q1 | AVGO, MPWR, NARI, NVDA, SNOW, SPOT, TSLA, TSM, TTD | - | - | - |
| Dec 31 2024 | 2024 Q4 | ANET, CYBR, LPLA, MSFT, NARI, NVDA, TSLA, VKTX | - | - | - |
| Sep 30 2024 | 2024 Q3 | AVGO, CRWD, DUOL, GDS, GWRE, INDI, MBLY, META, MSFT, NVDA, PAR, TEAM, TSLA | - | - | - |
| Jun 30 2024 | 2024 Q2 | AAPL, AMZN, AVGO, CSGP, EXAS, GWRE, IOT, MSFT, NVDA, TSM, VKTX, WDAY | - | - | - |
| Apr 15 2024 | 2024 Q1 | AVGO, INDI, MSFT, NVDA, RIVN, TSLA, TSM, VKTX | - | - | - |
| Jan 27 2024 | 2023 Q4 | AMZN, ARGX, GPCR, ILMN, LRCX, MSFT, NVDA, TTD | - | - | - |
| Sep 30 2023 | 2023 Q3 | ARGX, DT, INDU, LEGN, MSFT, NVDA, RIVN | - | - | - |
| Jul 30 2023 | 2023 Q2 | AMZN, DAVA, ILMN, INDU, MBLY, MSFT, NVDA, RIVN, ZI | - | - | - |
| Mar 31 2023 | 2023 Q1 | AMZN, ARWR, CSGP, DAVA, DXCM, EW, INDU, IT, META, MRVL, MSFT, NVDA, RIVN, TSLA, ZI | - | - | - |
| Dec 31 2022 | 2022 Q4 | AMD, AMZN, CRWD, INDI, IT, MA, MSFT, NVDA, RCKT, RIVN, TSLA, V, XFCH, ZI | - | - | - |
| Sep 30 2022 | 2022 Q3 | ARGX, GOOG, INDI, ISRG, IT, MPWR, MSFT, NET, NOW, NVDA, RIVN, SHOP, TSLA, ZI | - | - | - |
| Jun 30 2022 | 2022 Q2 | AMD, AMZN, ARGX, ASML, GOOG, MSFT, NET, NVDA, TSLA | - | - | - |
| Mar 31 2022 | 2022 Q1 | ARWR, CDAY, CRWD, ILMN, MDB, MSFT, RIVN, SHOP, SWAV, TSLA, V | - | - | - |
| QUARTER | THEMES | TAGS |
|---|---|---|
| 2025 Q4 |
AIAI has become a dominant theme across major equity indices, with Nvidia leading the S&P 500, ASML dominating MSCI EAFE, and TSMC leading emerging markets. The fund benefited from AI-related dynamics, particularly through Samsung's memory products experiencing substantial price increases due to DRAM shortages driven by AI demand. |
Semiconductors Memory DRAM Technology Nvidia |
CloudSnowflake was added as the leading player in cloud data storage, providing comprehensive data warehousing services for large businesses. The company's cloud-native platform helps companies store, analyze and share data across organizations, crucial for AI infrastructure upgrades. |
Data Storage Infrastructure Platform Enterprise | |
GLP1Eli Lilly's portfolio of Mounjaro/Zepbound GLP-1/GIP drugs are important treatments for diabetic and non-diabetic obese patients. This drug class should become the standard of care for both diabetes and obesity and grow to at least a $150 billion category. The market is in early innings of uptake with adoption driving Lilly to nearly double revenues by 2030. |
Diabetes Obesity Standard Care Adoption Growth | |
SemiconductorsTaiwan Semiconductor represents the dominant manufacturer for leading fabless chip designers including NVIDIA, Apple, and Broadcom. The global arms race to develop artificial general intelligence will support multiple years of robust growth for foundries with leading-edge capabilities. |
Foundries Advanced Process AI Chips Manufacturing Technology Leadership | |
SpaceSpaceX is generating significant value with rapid expansion of Starlink broadband service, deploying vast satellite constellation with substantial user growth. The company has established itself as leading launch provider with reusable technology and is making tremendous progress on Starship rocket. SpaceX represents the fund's largest position at 19.2% of net assets. |
Satellites Launch Starlink Starship Reusable | |
StreamingNetflix has built a durable economic moat around its globally-scaled streaming business. With more than 300 million members, Netflix enjoys the lowest content cost per subscriber in the industry, enabling it to profitably outspend rivals and accelerate its competitive flywheel. |
Content Global Scale Subscription Competitive Moat Media | |
| 2025 Q3 |
AIAI has become a dominant theme across major equity indices, with Nvidia leading the S&P 500, ASML dominating MSCI EAFE, and TSMC leading emerging markets. The fund benefited from AI-related dynamics, particularly through Samsung's memory products experiencing substantial price increases due to DRAM shortages driven by AI demand. |
Semiconductors Memory DRAM Technology Nvidia |
| 2025 Q2 |
AIAI has become a dominant theme across major equity indices, with Nvidia leading the S&P 500, ASML dominating MSCI EAFE, and TSMC leading emerging markets. The fund benefited from AI-related dynamics, particularly through Samsung's memory products experiencing substantial price increases due to DRAM shortages driven by AI demand. |
Semiconductors Memory DRAM Technology Nvidia |
US Equities |
| Date | Pitch Type | Author | Ticker | Company | Industry | Sub Industry | Bull / Bear | Exchange | Keywords | Action |
|---|---|---|---|---|---|---|---|---|---|---|
| Nov 8, 2025 | Fund Letters | Michael A. Lippert | NEE | NextEra Energy, Inc. | Utilities | Electric Utilities | Bull | NYSE | Demographics, dividends, ratebase, Regulation, renewables, Solar, utilities, Wind | Login |
| Nov 8, 2025 | Fund Letters | Michael A. Lippert | FFBC | First Financial Bancorp. | Financials | Regional Banks | Bull | NASDAQ | Banks, Credit, M&A, profitability, Regionals, Roa, Rotce, valuation | Login |
| Nov 8, 2025 | Fund Letters | Michael A. Lippert | NVDA | NVIDIA Corporation | Information Technology | Graphics & AI processors | Bull | NASDAQ | Artificial Intelligence, competitive moat, data centers, Free Cash Flow, GPUs, hyperscalers, semiconductors, valuation | Login |
| Nov 8, 2025 | Fund Letters | Michael A. Lippert | TSLA | Tesla, Inc. | Consumer Discretionary | Electric vehicles & energy storage | Bull | NASDAQ | Autonomy, Electric Vehicles, energy storage, growth, Margins, Software, valuation, vertical integration | Login |
| Nov 8, 2025 | Fund Letters | Michael A. Lippert | AVGO | Broadcom Inc. | Information Technology | Data center & networking semiconductors | Bull | NASDAQ | AI infrastructure, ASICs, buybacks, capital allocation, data centers, dividends, Free Cash Flow, semiconductors | Login |
| Nov 8, 2025 | Fund Letters | Michael A. Lippert | TTD | The Trade Desk, Inc. | Communication Services | Programmatic advertising platforms | Bull | NASDAQ | Competitive Advantage, Connected tv, digital advertising, Free Cash Flow, Identity, operating leverage, Programmatic | Login |
| Nov 8, 2025 | Fund Letters | Michael A. Lippert | IT | Gartner, Inc. | Information Technology | Technology research & advisory | Bull | NYSE | competitive moat, Free Cash Flow, generative AI, Pricing power, recurring revenue, research, subscription revenue | Login |
| Nov 8, 2025 | Fund Letters | Michael A. Lippert | PAR | PAR Technology Corporation | Information Technology | Restaurant POS software | Bull | NYSE | ARR growth, Free Cash Flow, operating leverage, Point of Sale, recurring revenue, Restaurant technology, Vertical SaaS | Login |
| TICKER | COMMENTARY |
|---|---|
| ACLX | Arcellx, Inc. is developing cell therapies for multiple myeloma, including lead candidate anito-cel in partnership with Gilead. Despite encouraging clinical results for anito-cel, Arcellx detracted from performance following Johnson & Johnson's announcement of strong data for its Tecvayli plus Darzalex combination in previously treated, Darzalex-naïve patients, suggesting increased competition for BCMA CAR-T therapies. |
| AMZN | We added to our holdings in Amazon.com Inc. |
| ARGX | argenx SE is a global immunology company focused on improving the lives of patients suffering from severe autoimmune diseases. Their stock jumped 14% due to strong progress in its Vyvgart franchise, driven by higher pre-filled syringe sales volumes for both the myasthenia gravis and chronic inflammatory demyelinating polyneuropathy indications. There are multiple catalysts over the next 12 months that could drive additional growth. |
| AXON | Axon Enterprise Inc. develops and produces Taser weapons and body cameras for law enforcement agencies. Investors have grown accustomed to big beats and raises from Axon. A slight beat to third-quarter projections and mixed fourth-quarter guidance triggered a -21% decline. We added to the position due to solid customer growth and retention. There are also numerous growth drivers for their business including Taser 10, bodycam 4, and their artificial intelligence software bundle. |
| BRCM | We invested in Broadcom Inc. nearly two years ago after spending two hours with its CEO and founder, Hock Tan. Broadcom has already been a 2.5-bagger for the Fund. These returns resulted from explosive growth not multiple expansion. |
| CSGP | CoStar Group is a premier information services provider to the commercial and residential real estate industries. For the last few years, we have watched the core businesses under the CoStar umbrella enjoy solid double-digit revenue growth along with consistent margin expansion. However, at the enterprise level, margins have contracted significantly due to the company's large and persistent investment in Homes.com. The results of the company's residential efforts have fallen dramatically short of its long-term expectations. |
| DUOL | I have followed the company closely since the IPO since my wife was an avid user, not wanting to break her streak in learning Italian. I thought growth would drop off a cliff after COVID as happened with many other companies, and yet, quarter after quarter the company continued to execute. In fact, there are only four companies I can find that have grown revenues greater than 30% for at least the last 20 quarters in a row – MercadoLibre, Axon, Hims, and Duolingo. To have that growth endurance, you've got to be doing something right! Well, the stock was down almost 70% after the valuation got far too rich and management made it very clear they were prioritizing learning over monetization for 2026. That is the right call in my opinion, considering what the core competency of the company is. Duolingo shouldn't be thought of as a language learning app, it's an engagement machine that happens to educate. In service of its mission to make education widely available, it built the data-driven muscle of engaging users. To learn anything, the most difficult part is motivation and that is what Duolingo is good at. In fact, almost 40% of monthly users log into the app every day. For context, Snapchat is at 50%! You're telling me that an app that teaches you Spanish almost has the same level of engagement as the app where teens do all of their communication? As the company broadens its education subjects like math, music, chess, and other areas, retention should increase even more. If you get bored of learning a language, you can hop over to play some chess. And AI will allow the company to create better content for their current subjects and accelerate the broadening of the platform. Paired with the engagement muscle, Duolingo very well could become a must-have app for learning all sorts of things. This vision will take time but it's actually the exact vision of the CEO/founder. The main bear cases are AI translation and that no one actually learns anything. On the latter, it's up to the user. Duolingo can't force you to learn anything. But yes, education apps typically have very high churn. The fact that Duolingo is able to increase paid subs at a rapid rate despite the leaky bucket is incredibly impressive. On the former, language learning isn't all about practicality. For a large portion of users, they're trying to learn English and they actually really want to understand the language rather than use AI translating glasses. And secondly, Duolingo includes a structure for habit formation. The company is already embedding AI into its content program with its Max Tier so as the models improve, so should Duolingo's product. It's easy to say that high engagement, alone, isn't a moat and I'd agree but the company's core competency is A/B testing and therefore, the product improves at a much higher rate than competitors as it scales. We paid ~18x FCF, inclusive of stock-based comp. That's not super cheap but for a company with an exceptional founder and growth endurance rivaling our long-time holdings, MercadoLibre and Axon, we decided to finally start a position. |
| EXAS | Exact Sciences Corp. is a cancer diagnostics company best known for Cologuard, its at-home screening test for colorectal cancer. The stock initially rose during the quarter on signs of reinvigorated growth and the introduction of a new test that drove revenue higher. Performance was further boosted in November when Abbott announced plans to acquire Exact Sciences at a significant premium. |
| GOOGL | I'm willing to go bankrupt rather than lose this race. Larry Page, co-founder of Google |
| GTLB | We initiated a new investment position in GitLab (GTLB), a Dev/Sec/Ops software platform vendor that helps software developers plan, build, and monitor code for new and existing applications. The stock has been under severe pressure for some time, largely due to the belief that AI-powered 'Vibe Coding' software companies will displace GTLB solutions. We fundamentally reject this thesis and believe that as software development becomes easier and more productive, more code will be generated, increasing the need for planning, development, and monitoring tools like GitLab's. We estimate GTLB's intrinsic value is $75 per share. |
| HRTX | Heartflow, Inc. is a medical device company providing an AI-powered engine to diagnose heart disease. Heart disease is responsible for 1 in 5 deaths in the U.S., and every 40 seconds someone has a heart attack. There is an urgent need to quickly and accurately catch this disease before it reaches this stage. Heartflow's solution provides a minimally invasive way to catch blockages in the heart vessels, reducing both false negatives and false positives relative to standard of care today. The company has a strong competitive moat, with a repository of 110 million images supplemented by human-aided training that has taken over 10 years to build. |
| LLY | Healthcare added meaningfully through Eli Lilly following a deal the company did with the US administration to reduce the price of its GLP-1 drugs in exchange for tariff relief. |
| META | Meta was cited as a larger position that contributed little despite what I thought was positive operating progress, representing opportunity cost in the portfolio. |
| MSFT | OpenAI's well-documented 'circular' funding with its business partners (NVIDIA, Microsoft, among others) is additional cause for concern. |
| NVDA | Nvidia sits at the top of the S&P 500 as the designer in the AI ecosystem. |
| ONON | On Holding, a premium athletic footwear and apparel company gaining share globally. On Holding delivered an impressive quarter punctuated by strong growth in international markets, such as China, as well as accelerating growth from apparel. |
| ORCL | Investor enthusiasm for Oracle's stock in calendar year 2025 was initially driven by several multi-billion-dollar contracts it signed with leading AI companies, including OpenAI and Meta. However, in Q4 sentiment for ORCL's growth prospects shifted to skepticism, as investors began to scrutinize the return profile of the substantial capital investments required to support the approximately $500 billion of contracts signed by Oracle. |
| SPOT | Spotify is the world's leading audio streaming platform. Third-quarter results showed continued operating progress, with users increasing 11% to 713 million and subscribers growing 12% to 281 million. Meanwhile, operating income expanded to a mid-teens margin, alongside a record quarterly free cash flow. Despite the momentum, the shares weakened as investors reset near-term margin expectations. Spotify has been a top contributor to long-term Fund performance, and we remain confident that pricing, product innovation, advertising efficiency, and an expanding ecosystem can continue to widen margins over time, as reinforced this quarter by the launch of Spotify recommendations within ChatGPT. |
| TSLA | The largest 10 companies, by market capitalization, had reached 40.7% of the S&P 500 by the end of 2025, up from roughly 30% at the end of 2021. At the top of this list are Nvidia (NVDA), Apple (AAPL), Microsoft (MSFT), Alphabet (GOOGL), Amazon (AMZN), Broadcom (AVGO), Meta (META), and Tesla (TSLA). |
| TTD | Communication Services also detracted from relative performance, driven by early-year weakness in The Trade Desk (TTD). The company, one of the world's largest independent demand-side advertising platforms, faced its first revenue miss in more than eight years and issued softer-than-consensus expected guidance. These challenges were compounded by disruptions from a sales reorganization and slower adoption of its new AI-powered platform, Kokai. |
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