Baron Capital, an investment management company, released its “Baron Financials ETF” fourth-quarter 2025 investor letter. A copy of the letter can be downloaded here. In the fourth quarter, the Fund fell 2.22% (Institutional Shares) compared to a 7.19% decline for the FactSet Global FinTech Index (Benchmark) and a 2.07% gain for the MSCI USA Financials Index. Since inception, the Fund returned a 10.21% annualized rate compared to 2.55% and 11.97% return for the indexes. In December 2025, the product transitioned from a mutual fund to an exchange-traded fund (ETF) in response to investor feedback. Despite this change in structure and name, the investment strategy continues to focus on a growth approach aimed at financial and financial-related companies. Several factors contributed to quarterly gains and a steady market recovery from the lows observed on April 8, including diminishing tariff effects, strong corporate earnings, and ongoing monetary easing. Moving to 2026, the firm is optimistic about the outlook for the financial sector and its holdings, given the healthy and supportive macroeconomic environment. In addition, please check the Fund’s top five holdings to know its best picks in 2025.
In its fourth-quarter 2025 investor letter, Baron Financials ETF highlighted stocks like Jack Henry & Associates, Inc. (NASDAQ:JKHY). Jack Henry & Associates, Inc. (NASDAQ:JKHY) is a financial technology company that offers solutions and payment processing services for community banks and credit unions. On March 27, 2026, Jack Henry & Associates, Inc. (NASDAQ:JKHY) stock closed at $153.31 per share. One-month return of Jack Henry & Associates, Inc. (NASDAQ:JKHY) was -6.63%, and its shares declined 16.04% over the past twelve months. Jack Henry & Associates, Inc. (NASDAQ:JKHY) has a market capitalization of $11.096 billion.
Baron Financials ETF stated the following regarding Jack Henry & Associates, Inc. (NASDAQ:JKHY) in its fourth quarter 2025 investor letter:
“Jack Henry & Associates, Inc. (NASDAQ:JKHY) is a leading provider of technology solutions for community banks and credit unions. Shares rose after the company reported better-than-expected quarterly results and raised financial guidance. Adjusted revenue grew 9% and earnings per share increased 21% in the quarter, reflecting a favorable demand environment, market share gains, and strong margin expansion. Management raised fiscal year guidance for both revenue and earnings while noting potential for further upside. Shares also benefited from expectations for competitive wins versus Fiserv as it undertakes a disruptive, multi-year effort to consolidate 16 core platforms. We expect Jack Henry to continue gaining share in a growing market as financial institutions increase investment in technology and automation.”
Jack Henry & Associates, Inc. (NASDAQ:JKHY) is not on our list of 40 Most Popular Stocks Among Hedge Funds Heading Into 2026. According to our database, 37 hedge fund portfolios held Jack Henry & Associates, Inc. (NASDAQ:JKHY) at the end of the fourth quarter, the same as in the previous quarter. While we acknowledge the risk and potential of Jack Henry & Associates, Inc. (NASDAQ:JKHY) 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 Jack Henry & Associates, Inc. (NASDAQ:JKHY) and that has 10,000% upside potential, check out our report about this cheapest AI stock.
In another article, we covered Jack Henry & Associates, Inc. (NASDAQ:JKHY) and shared the list of set-it-and-forget-it stocks to buy in 2026. In addition, please check out our hedge fund investor letters Q4 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.
