Baron
Baron Small Cap Fund
US Small-cap
Dec 2024 → Jun 2026
Our archive holds 7 letters from this strategy, behind 15 investment theses and positions in 37 companies. Every quote below is copied verbatim from the letter it came from.
7 letters in 3 years — follow all of Baron for every strategy.
What it bought and sold
Wingstop Inc. was a previous successful investment that remains a best-in-class franchisor with stellar unit economics and long growth runway.
During the quarter, our largest sales were trims of some of our largest and best performing stocks (Vertiv Holdings Co, Legence Corp., The Cheesecake Factory Incorporated, and Cognex Corporation).
We trimmed these names to right size the positions and acknowledge expanded valuations.
During the quarter we initiated a position in Shake Shack Inc., a premium fast-casual burger chain, after the stock sold off almost 30% after its Q1 earnings call on a reported bad comp in April, and slightly lower fiscal year margin guidance from rising beef inflation.
We reallocated funds from Accelerant Holdings and PAR Technology Corporation to other ideas we like more.
We trimmed these names to right size the positions and acknowledge expanded valuations.
We reallocated funds from Accelerant Holdings and PAR Technology Corporation to other ideas we like more.
During the quarter, our largest sales were trims of some of our largest and best performing stocks (Vertiv Holdings Co, Legence Corp., The Cheesecake Factory Incorporated, and Cognex Corporation).
We participated in the IPO of Blackstone Digital Infrastructure Trust Inc. , a newly listed Blackstone-sponsored vehicle focused on acquiring stabilized, fully leased data centers underpinned by long-term, non-cancellable leases to the world's largest hyperscalers in primary data center markets.
During the quarter, our largest sales were trims of some of our largest and best performing stocks ( Vertiv Holdings Co , Legence Corp. , The Cheesecake Factory Incorporated , and Cognex Corporation ).
Though we have trimmed our position along the way, we maintain a large position believing strongly in the future success of the company.
We acquired shares of Casella Waste Systems, Inc. , a well-entrenched market leader with high barriers to entry in an industry we understand well (after more than a decade owning Waste Connections, Inc. ) at what we believe is an attractive entry point.
Applied Aerospace & Defense, Inc. is a premier provider of mission-critical structures and components for the aerospace and defense industrial base.
We sold three positions during the quarter, with the largest disposal being Floor & Decor Holdings, Inc. as existing home sales, a key driver for flooring demand, remain weak and we favor other ways to play a future housing recovery.
We are investing again in this high-quality “fallen angel” at what we think is a meaningfully discounted valuation.
Also held
- Karman Holdings Inc.
- Hinge Health, Inc.
- Guidewire Software, Inc.
- Kinsale Capital Group, Inc.
- JBT Marel Corporation
- Kratos Defense & Security Solutions, Inc.
- TransDigm Group Incorporated
- Gartner, Inc.
- Andersen Group Inc.
- Enpro Inc.
- Everforth, Inc.
- Planet Fitness, Inc.
- Madison Square Garden Sports Corp.
- Intapp, Inc.
- Red Rock Resorts, Inc.
- SiteOne Landscape Supply, Inc.
- Novanta Inc.
- First Advantage Corporation
- The Baldwin Insurance Group, Inc.
- ICON plc
- Liberty Media Corporation - Liberty Formula One
- Exponent, Inc.
- Installed Building Products, Inc.
- Bright Horizons Family Solutions, Inc.
Its investment theses
- Shake Shack Inc.Jun 2026Shake Shack Inc. is a premium fast-casual chain with strong unit economics, a long store runway, and attractive growth relative to valuation.
- Blackstone Digital Infrastructure Trust Inc.Jun 2026Blackstone Digital Infrastructure Trust Inc. targets stabilized data centers and offers attractive, visible returns supported by Blackstone’s sourcing edge and long-term leases.
- Vertiv Holdings CoJun 2026Vertiv Holdings Co supplies data-center power and cooling systems and is backed by strong growth, market-leading solutions, and attractive long-term financial targets.
- Applied Aerospace & Defense, Inc.Jun 2026Applied Aerospace & Defense, Inc. has an IP-rich, sole-source franchise with durable growth potential and expanding margins across attractive defense end markets.
- Guidewire Software, Inc.Jun 2026Guidewire Software, Inc. sells core insurance software and has a large recurring-revenue opportunity that AI could expand through automation and intelligence.
- Once Upon a Farm, PBCMar 2026Once Upon a Farm is a fast-growing organic childhood nutrition brand with differentiated products, strong management, and long-term compounding potential.
- Guidewire Software, Inc.Mar 2026Guidewire is a property and casualty insurance software leader with accelerating cloud growth, sticky customers, and AI tailwinds.
- Planet Fitness, Inc.Mar 2026Planet Fitness is a category-leading low-cost fitness franchise with strong management, improving operations, and a cheap valuation.
- Neptune Insurance Holdings Inc.Dec 2025Neptune Insurance Holdings Inc. is a capital-light MGA leader in private flood insurance using proprietary tech to take share from NFIP and support strong EBITDA growth.
- Andersen Group Inc.Dec 2025Andersen Group Inc. is a high-quality tax and advisory firm with strong brand, global network, and multiple growth levers including partner expansion and acquisitions.