Core Insights - Bristol Gate Capital Partners' Q3 2025 investor letter indicates that the US Equity Strategy underperformed the S&P 500® Total Return Index this quarter, primarily due to limited exposure to the AI/TMT and Value sectors, which benefited from the Federal Reserve's rate cut [1] - Despite the underperformance, the portfolio achieved a 15% dividend growth over the trailing 12 months, supported by strong underlying fundamentals [1] Company Highlights - Thermo Fisher Scientific Inc. (NYSE:TMO) is highlighted as a key stock, with a one-month return of 0.53% and a 12.15% increase in share value over the last 52 weeks, closing at $583.45 per share on December 30, 2025, with a market capitalization of $219.207 billion [2] - The company reported Q2 2025 revenue of $10.85 billion, exceeding the consensus estimate of $10.68 billion, and earnings per share of $5.36, surpassing the estimate of $5.22 [3] - Thermo Fisher's stock price increased by 9% following the positive earnings release on July 23, driven by 2% organic growth and the maintenance of long-term guidance [3] Investment Sentiment - Thermo Fisher Scientific Inc. ranks 26th among the 30 Most Popular Stocks Among Hedge Funds, with 121 hedge fund portfolios holding the stock at the end of Q3, an increase from 117 in the previous quarter [4] - While acknowledging Thermo Fisher's potential, there is a belief that certain AI stocks may offer greater upside potential and lower downside risk [4]

Core Viewpoint - Baron Health Care Fund's performance in Q3 2025 was a 5.39% increase, slightly outperforming the Russell 3000 Health Care Index's 5.05% gain, but lagging behind the broader Russell 3000 Index's 8.18% increase, primarily due to stock selection offset by negative impacts from sub-industry allocations and cash holdings during a rising market [1] Group 1: Fund Performance - The Baron Health Care Fund rose 5.39% in Q3 2025 compared to a 5.05% gain for its benchmark [1] - The fund's performance was similar to the benchmark, with solid stock selection being offset by negative effects from active sub-industry allocations and cash holdings [1] Group 2: Thermo Fisher Scientific Inc. (NYSE:TMO) - Thermo Fisher Scientific Inc. is highlighted as a key stock in the fund's portfolio, with a one-month return of 4.31% and a 52-week gain of 2.15% [2] - As of October 31, 2025, Thermo Fisher's stock closed at $567.39, with a market capitalization of $214.253 billion [2] - The fund added to its position in Thermo Fisher, which is expected to achieve 3% to 6% organic revenue growth in 2026 and 2027, with potential for mid-to-high single-digit adjusted operating income growth [3] - Management anticipates that beyond 2027, Thermo Fisher could deliver over 7% organic revenue growth due to positive long-term drivers in the life sciences tools industry [3] - Thermo Fisher Scientific's revenue grew 3% to $10.85 billion in Q2 2025, and it ranks 26th among the 30 most popular stocks among hedge funds, with 117 hedge fund portfolios holding its shares [4]