Here’s What Makes On Holding AG (ONON) a Strong Long-Term Investment?

Baron Funds, an investment management company, released its fourth-quarter investor letter for the “Baron Focused Growth Fund”. A copy of the letter can be downloaded here. The Fund delivered strong results in the fourth quarter, appreciating 12.34% (Institutional Shares) compared to the Russell 2500 Growth Index’s (the Benchmark) 0.33 % return. The Fund returned 22.26% in 2025 compared to 10.31% return for the index. The firm highlighted its continued faith in its portfolio companies in the letter. As of December 31, 2025, the Fund’s top 10 positions hold 60.1% of net assets. Please review the Fund’s top five holdings to gain insights into their key selections for 2025.

In its fourth-quarter 2025 investor letter, Baron Focused Growth Fund highlighted On Holding AG (NYSE:ONON). On Holding AG (NYSE:ONON) is a Swiss Athletic company specializing in sports products, which rose 9.8% and contributed 55 bps to find’s quarterly performance. The one-month return of On Holding AG (NYSE:ONON) was -12.62%, and its shares lost 23.91% of their value over the last 52 weeks. On February 5, 2026, On Holding AG (NYSE:ONON) stock closed at $42.92 per share, with a market capitalization of $14.171 billion.

Baron Focused Growth Fund stated the following regarding On Holding AG (NYSE:ONON) in its fourth quarter 2025 investor letter:

“Premium footwear and apparel brand On Holding AG (NYSE:ONON) increased 9.8% and added 55 bps to performance in the fourth quarter. The company continues to generate strong revenue growth with accelerated margin expansion despite concerns about tariffs and increased competition from Nike. On’s strong brand and premium positioning is allowing it to offset tariff exposure through selective price increases, while demand for its products remains resilient. The company should continue to grow for many years to come while taking share in the highly attractive global sportswear market. They remain a small player in a large growing market with just 2% of the global sports footwear market. We believe On has differentiated itself through its engineered solution and that the company’s innovation capabilities should fuel share gains for many years. This growth should be supported by expansions across categories, retail outlets, and geographies. We believe the company should be able to grow revenue at a CAGR of over 20% the next few years leading to EBITDA growth of over 30%, which when combined with a mid-single-digit yield on free cash flow should set the stock up for strong returns in the years to come.”

In another article, we covered On Holding AG (NYSE:ONON) and shared a list of stocks that should double by 2030. In addition, please check out our hedge fund investor letters Q4 2025 page for more investor letters from hedge funds and other leading investors.

READ NEXT: The Best and Worst Dow Stocks for the Next 12 Months and 10 Unstoppable Stocks That Could Double Your Money.

Disclosure: None. This article is originally published at Insider Monkey.