| ANNUALIZED SINCE INCEPTION | QUARTERLY | YTD |
|---|---|---|
| 9.4% | 3.5% | 5.9% |
| 2025 |
|---|
| 5.9% |
TimesSquare Capital Management's U.S. Small Cap Growth Strategy outperformed the Russell 2000 Growth Index in Q4 2025, returning 3.45% net after a challenging summer and fall period. The strategy focuses on companies with quality management, competitive advantages, and sustainable growth across technology, healthcare, consumer, and industrial sectors. Key contributors included JFrog, which rallied 32% on increased cybersecurity demand following supply chain attacks, and Ceribell, which surged 91% after FDA clearance for neonatal EEG applications. The portfolio emphasizes specialty retailers like Boot Barn and Ollie's, biotechnology companies including Abivax and NewAmsterdam Pharma, and nuclear energy exposure through Uranium Energy. Consumer caution amid labor market softening and low-quality market bias toward companies with poor returns on equity present ongoing risks. The manager expects increased AI adoption, higher corporate spending from tax legislation, and awaits Supreme Court decisions on tariffs. The fundamental research-driven approach targets steady management teams capable of driving economic growth.
TimesSquare Capital Management focuses on small-cap growth companies with quality management, distinct competitive advantages, and strong sustainable growth, emphasizing fundamental research-driven stock selection across technology, healthcare, consumer, and industrial sectors.
The manager remains focused on fundamentals, seeking steady management teams capable of driving economic growth at their companies, which they believe will be rewarded over time by the markets. They are awaiting the Supreme Court decision on Trump Administration tariffs and expect increased AI adoption and corporate spending from the One Big Beautiful Bill.
| Date | Letter | Tickers | Keywords | Pitches | Quick Takes |
|---|---|---|---|---|---|
| Jan 21 2026 | 2025 Q4 | ABVX.PA, AXGN, BOOT, CBLL, CWST, FROG, LGCE, MTSI, NAMS, NSKE, OLLI, SLNO, STVN, TTEK, UEC, WRBY | Biotechnology, consumer, energy, growth, healthcare, industrials, small caps, technology |
BOOT WRBY OLLI UEC AXGN FROG |
The fund holds multiple biotech positions including Abivax SA for ulcerative colitis treatment, NewAmsterdam Pharma for cholesterol inhibitors, and Axogen for peripheral nerve regeneration. Strong… |
| Oct 12 2025 | 2025 Q3 | ACVA, BJ, CWST, INSP, KTOS, MIR, MRUS, NAMS, PAR, PRSU, SITM, SLNO, UNF, VRTX | AI, consumer, cyclicals, small caps, valuation |
KRAT US SITM US |
Small-cap growth leadership remains narrowly concentrated in AI beneficiaries. The strategy finds opportunity in cyclicals and consumer-oriented firms where fundamentals and valuations diverge, anticipating normalization… |
| Jul 15 2025 | 2025 Q2 | - | earnings growth, growth, innovation, market dispersion, small cap |
KRYS KTOS CWAN |
The commentary emphasizes small-cap growth opportunities where fundamentals are improving faster than market expectations. Volatility and tariff-related uncertainty have created dispersion, enabling selective stock picking.… |
| Mar 31 2025 | 2025 Q1 | ACVA, ADUS, AZEK, BFAM, BJ, BOOT, CBLL, CHEF, CWST, DAWN, ERJ, FORM, FROG, FRPT, HLNE, INR, INSM, ITCI, KTOS, MGY, MVBF, PAY, PI, RRX, SLNO, TTEK, VERX, VRNA, VVV, WHD | - | - | - |
| Sep 30 2024 | 2024 Q3 | BJ, BOOT, CERT, CWAN, FORM, LOAR, MODG, MTDR, MYRG, OS, PCVX, WH, WHD | - | - | - |
| Jun 30 2024 | 2024 Q2 | ADUS, ATRC, AZEK, BJ, BOOT, CERT, DRVN, ESAB, EWCZ, HLNE, HXL, IAC, MAX, MRUS, MVBF, NSA, RRX, SILK, SVV, TMCI, TTEK, VCTR, WRBY, WSC | - | - | - |
| Apr 15 2024 | 2024 Q1 | ASND, BJ, BOOT, EME, ESAB, FLYW, FROG, KRYS, MTDR, ONTO, PRA, RAPT, SMAR, SWAV, VCTR, VERX, WING, WNS | - | - | - |
| Dec 31 2023 | 2023 Q4 | ATGE, ATRC, BJ, FLYW, HLNE, PRA, VC, WING | - | - | - |
| Sep 30 2023 | 2023 Q3 | ALGM, BJ, CWAN, CWST, DRVN, EME, HCP, HLNE, HQY, INSP, KRYS, LESL, MODG, PLNT, PRA, TMCI, VERX | - | - | - |
| QUARTER | THEMES | TAGS |
|---|---|---|
| 2025 Q4 |
BiotechnologyAgronomics provides exposure to cellular agriculture and alternative protein production. BlueNalu focuses on cultured seafood with commercial launch expected in 2026. Liberation Bioindustries opening first commercial factory for alternative protein production. |
Cellular Agriculture Alternative Protein Biotechnology |
CybersecurityDemand for security increased following the recent NPM supply chain attack. JFrog's security add-on which secures open-source packages before organizations onboard them has seen significant pipeline growth, highlighting the critical need for software supply chain security. |
Cybersecurity Software Security Enterprise Technology | |
Medical DevicesHoldings include Ceribell for portable EEG technology and Stevanato Group for pharmaceutical packaging. Ceribell surged 91% after FDA clearance for neonatal applications, while Stevanato faced conservative guidance despite beating expectations. |
EEG Technology FDA Clearance Pharmaceutical Packaging Medical Technology Healthcare Innovation | |
NuclearPosition in Uranium Energy as the largest licensed uranium miner in the U.S., positioned to benefit from renewed focus on nuclear power as long-term energy solution and U.S. efforts to strengthen domestic nuclear fuel supply chains for national security. |
Uranium Mining Nuclear Power Energy Security Domestic Supply National Security | |
Specialty RetailFocus on value-oriented retailers, franchise models, and premium brands including Boot Barn for western wear, Warby Parker for eyewear, and Ollie's Bargain Outlet for closeouts. Consumer behavior shifts toward lower-priced inventory are impacting performance, with mixed results across positions. |
Consumer Behavior Franchise Models Premium Brands Trade Down Retail | |
| 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 |
ConsumerThe consumer segment includes DJL Petfoods (pet food ingredients distributor) and TSDC Wholesale (food and grocery wholesale). DJL exemplifies RDCP 2.0 characteristics as an asset-light but infrastructure-critical business with long-standing customer relationships, exceptional retention rates, and exposure to growing pet ownership and premiumisation trends. These businesses benefit from structural advantages and recurring revenue streams. |
Pet Care Food Distribution Consumer Staples Wholesale Distribution | |
Cyclicals |
||
| 2025 Q2 |
Growth |
| Date | Pitch Type | Author | Ticker | Company | Industry | Sub Industry | Bull / Bear | Exchange | Keywords | Action |
|---|---|---|---|---|---|---|---|---|---|---|
| Jul 15, 2025 | Fund Letters | Grant R. Babyak | KRYS | Krystal Biotech, Inc. | Health Care | Biotechnology | Bear | NASDAQ | Commercialization, Demand, gene therapy, rare disease, Salesforce, Volatility | Login |
| Jul 15, 2025 | Fund Letters | Grant R. Babyak | KTOS | Kratos Defense & Security Solutions, Inc. | Industrials | Aerospace & Defense | Bull | NASDAQ | Defense, Drones, Hypersonic, margin, Missile-Defense, Space | Login |
| Jul 15, 2025 | Fund Letters | Grant R. Babyak | CWAN | Clearwater Analytics Holdings, Inc. | Information Technology | Application Software | Bull | New York Stock Exchange | Accounting, Acquisitions, asset management, Dilution, Integration, SaaS | Login |
| Jan 21, 2026 | Fund Letters | Grant R. Babyak | BOOT | Boot Barn Holdings, Inc. | Consumer Discretionary | Specialty Retail | Bull | New York Stock Exchange | Margins, retail, Storegrowth, valuation, Westernwear | Login |
| Jan 21, 2026 | Fund Letters | Grant R. Babyak | WRBY | Warby Parker Inc. | Consumer Discretionary | Specialty Retail | Bull | New York Stock Exchange | Direct toconsumer, Eye wear, innovation, Margins, smart glasses | Login |
| Jan 21, 2026 | Fund Letters | Grant R. Babyak | OLLI | Ollie’s Bargain Outlet Holdings, Inc. | Consumer Discretionary | Discount Retail | Bull | NASDAQ | Cost control, discount retail, Loyalty, Store growth, Value | Login |
| Jan 21, 2026 | Fund Letters | Grant R. Babyak | UEC | Uranium Energy Corp. | Energy | Uranium | Bull | New York Stock Exchange | Commodities, energysecurity, Nuclear, Policy, uranium | Login |
| Jan 21, 2026 | Fund Letters | Grant R. Babyak | AXGN | Axogen, Inc. | Health Care | Medical Devices | Bull | NASDAQ | FDA, Medicaldevices, Nerves, Regeneration, Trauma | Login |
| Jan 21, 2026 | Fund Letters | Grant R. Babyak | FROG | JFrog Ltd. | Information Technology | Application Software | Bull | NASDAQ | Devops, growth, Security, Software, supply chain | Login |
| Oct 12, 2025 | Fund Letters | Grant R. Babyak | KRAT US | Kratos Defense & Security Solutions Inc | Other | Aerospace & Defense | Bull | NASDAQ | Aerospace, backlog, Defense, Drones, government contracts, growth, Margins | Login |
| Oct 12, 2025 | Fund Letters | Grant R. Babyak | SITM US | SiTime Corp | Information Technology | Semiconductor Components | Bull | NASDAQ | AI, design wins, growth, Mems, Oscillators, semiconductors, technology | Login |
| TICKER | COMMENTARY |
|---|---|
| ABVX.PA | That includes the biopharma developer of treatments for bowel diseases, Abivax SA. We first purchased Abivax in the summer, after it reported strong clinical trial results for its obefazimod treatment to address ulcerative colitis in a longer-lasting manner with fewer side effects than current medicines. Toward the end of the year, there was speculation that Abivax was in the acquisition crosshairs of a larger pharmaceutical company, and we trimmed our position as it rose by 58%. |
| AXGN | New to the strategy was Axogen, Inc., which develops technologies for peripheral nerve regeneration and repair from injuries caused by trauma, chronic conditions, or surgical procedures. Its flagship product, Avance Nerve Graft, is a decellularized human nerve allograft that preserves native nerve microarchitecture while eliminating immune rejection risk. It is the only FDA-approved implantable biological nerve allograft on the market. |
| BOOT | Boot Barn, the leader in a highly fragmented retail segment focused on western and work footwear, apparel, and accessories. Early in the quarter, Boot Barn's revenues and earnings handily exceeded estimates, with greater transaction volumes and new store openings. Boot Barn increased its guidance for the next fiscal year—including the number of new stores—and expects no disruption from planned price increases in mid-2026. Though its shares gained 6%, the underlying volatility was meaningful as sentiment began to shift. We grew concerned that the next report from Boot might include slower growth and cautious near-term guidance, so we trimmed our position, ultimately exiting entirely in early January. |
| CBLL | The share price of Ceribell, a leader in portable electroencephalogram (EEG) technology, surged 91% after reporting inline financial results and elevating its sales outlook for the remainder of its fiscal year. The recent FDA clearance for the company's Clarity algorithm for neonates significantly broadens Ceribell's total addressable markets and is expected to enable an earlier-than-anticipated neonatal launch. |
| CWST | The fortunes of Casella Waste Systems waxed and waned during the quarter. At the beginning of the quarter, Casella's shares slipped ahead of its fiscal quarterly report. After showing revenues and earnings higher than anticipated, along with better full-year guidance, its share price recovered and ended the quarter up 3% for this provider of solid waste collection, transfer, disposal, and recycling services for residential, commercial, municipal, and industrial customers. |
| FROG | Lastly was JFrog Ltd., the portfolio's strongest performer this quarter. JFrog manages the software supply chain and enables organizations to securely deliver software updates across their enterprises. Demand for security increased following the recent NPM supply chain attack. JFrog's security add-on—which secures open-source packages before organizations onboard them—has seen significant pipeline growth, driving a 32% rally in its shares. |
| LGCE | Gaining 40% was Legence Corp., which provides engineering, installation, and maintenance services for mission-critical systems in buildings. Purchased through its IPO in September, Legence serves high-growth sectors with technically demanding buildings, including data centers, other technology, life sciences, other health care, and education. As its shares continued to climb, we trimmed the position. |
| MTSI | At the beginning of the quarter, we added to our position in MACOM Technology, an analog semiconductor solutions provider. Later, the company bested expectations for revenues and earnings, with management increasing its guidance for the next quarter. That lifted its shares by 38%, and we trimmed our position at later peaks. |
| NAMS | Shares in the biopharma developer of cholesterol inhibitors for cardiovascular diseases, NewAmsterdam Pharma, rose by 23%. Indications were strongly positive for the upcoming trial results for its CETP inhibitor to reduce LDL levels. |
| NSKE | A recent IPO, the cybersecurity company providing security, networking, and analytics solutions Netskope, Inc. is a leader in modern security and networking for the cloud and AI era. Shares of Netskope sold off with other software and cybersecurity names during the quarter and declined by -23%, though we continued adding to our holdings. |
| OLLI | While Ollie's Bargain Outlet saw a -15% return, we have been increasing our position in the specialty retailer for closeouts, excess inventory, and salvage merchandise. Revenues were slightly below expectations as consumers shifted to even lower-priced store inventory, though Ollie's managed costs and reported better-than-expected earnings. Membership in Ollie's Army loyalty club grew as did the number of Ollie's stores, which we believe bodes well for its 2026 results. |
| SLNO | We closed our position in biopharma developer Soleno Therapeutics, which recorded a -34% decline while held within the portfolio this quarter. Even though the company's Vykat XR stands as the sole approved therapy for hyperphagia in Prader-Willi Syndrome (PWS), investor sentiment remains subdued due to ongoing concerns regarding the growth trajectory. |
| STVN | Pulling back by -22% was Stevanato Group, which manufactures glass packaging for syringes, autoinjectors, and other pharmaceutical needs. Recent revenues and earnings each exceeded expectations, though management was conservative and merely reaffirmed its guidance for the balance of its fiscal year. There may have been some advanced purchasing from customers, though Stevanato's core business grew well, and we added to our position on the weakness. |
| TTEK | Elsewhere in the sector, we exited our position in Tetra Tech, a consulting and engineering firm focused on water and related environmental services. We expected that the slowing national infrastructure spending in Australia would limit Tetra Tech's opportunities in the near term. |
| UEC | Uranium Energy is the largest licensed uranium miner in the U.S. We believe it is well-positioned to benefit from the renewed focus on nuclear power as a long-term energy solution and from U.S. efforts to strengthen domestic nuclear fuel supply chains for national security. However, recent volatility in uranium prices weighed on the stock, which declined -12% during the quarter. We continued to build our position in Uranium Energy after our first purchases at the end of September. |
| WRBY | It was a rollercoaster ride for shares in Warby Parker, which ended the quarter down by -22%. The online eyewear retailer's shares slid down sharply through October as the market was cautious ahead of November's fiscal quarterly report, and we added to our position. Warby reported lower-than-expected sales, though better margins led to higher earnings. After speaking with management, we believe Warby's core operations were stable, and the prevailing stock price undervalued the benefits from 2026's Google's smart glasses launch. Toward the end of the year, enthusiasm for smart glasses lifted Warby's shares, and we trimmed the position. |
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