Here’s What Signals HealthEquity’s (HQY) Future Earnings Power

Brown Advisory, an investment management company, released its “Brown Advisory Small-Cap Growth Strategy” second-quarter 2025 investor letter. During the first half of the year, the Brown Advisory Small-Cap Growth Strategy delivered results consistent with its historical performance. A copy of the letter can be downloaded here. In the first quarter of 2025, the portfolio remained robust, outperforming the declines of -9.5% for the Russell 2000 Index and -11.1% for the Russell 2000 Growth Index. However, in the second quarter, unprofitable companies within the Russell 2000 Index outperformed profitable ones, reversing a previous quarter. In addition, please check the fund’s top five holdings to know its best picks in 2025.

In its second-quarter 2025 investor letter, Brown Advisory Small-Cap Growth Strategy highlighted stocks such as HealthEquity, Inc. (NASDAQ:HQY). HealthEquity, Inc. (NASDAQ:HQY) provides financial technology solutions for healthcare and spending decisions. The one-month return of HealthEquity, Inc. (NASDAQ:HQY) was 5.05%, and its shares gained 15.58% of their value over the last 52 weeks. On September 03, 2025, HealthEquity, Inc. (NASDAQ:HQY) stock closed at $95.54 per share, with a market capitalization of $8.231 billion.

Brown Advisory Small-Cap Growth Strategy stated the following regarding HealthEquity, Inc. (NASDAQ:HQY) in its second quarter 2025 investor letter:

“HealthEquity, Inc. (NASDAQ:HQY): Provides range of solutions for managing health care accounts. HealthEquity Inc. (HQY) continues to execute well, gaining share in its primary business, managing health savings accounts. Higher-for-longer interest rates and the potential for legislation to drive HSA eligibility expansion bodes well for future earnings power.”

13 Cheap AI Stocks to Buy According to Analysts

HealthEquity, Inc. (NASDAQ:HQY) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 40 hedge fund portfolios held HealthEquity, Inc. (NASDAQ:HQY) at the end of the second quarter, which was 32 in the previous quarter. While we acknowledge the risk and potential HealthEquity, Inc. (NASDAQ:HQY) as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than HealthEquity, Inc. (NASDAQ:HQY) and that has 10,000% upside potential, check out our report about this cheapest AI stock.

In another article, we covered HealthEquity, Inc. (NASDAQ:HQY) and shared Baron Health Care Fund’s views on the company in the previous quarter. In addition, please check out our hedge fund investor letters Q2 2025 page for more investor letters from hedge funds and other leading investors.

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