Polen U.S SMID Company Growth Strategy Sold Charles River Laboratories International (CRL) for More Attractive Opportunities

Polen Capital, an investment management company, released its “Polen US SMID Company Growth Strategy” first-quarter 2025 investor letter. A copy of the letter can be downloaded here. The initial market optimism after the Presidential election gave way to fear and uncertainty in the first quarter of 2025. Against this backdrop, the fund returned -12.38% gross, and -12.65% net of fees compared to the Russell 2500 Growth Index return of -10.80%. In addition, you can check the fund’s top 5 holdings to find out its best picks for 2025.

In its first-quarter 2025 investor letter, Polen US SMID Company Growth Strategy highlighted stocks such as Charles River Laboratories International, Inc. (NYSE:CRL). Charles River Laboratories International, Inc. (NYSE:CRL) offers drug discovery, non-clinical development, and safety testing services that operate through Research Models and Services (RMS), Discovery and Safety Assessment (DSA), and Manufacturing Solutions (Manufacturing) segments. The one-month return of Charles River Laboratories International, Inc. (NYSE:CRL) was 2.83%, and its shares lost 31.41% of their value over the last 52 weeks.  On June 6, 2025, Charles River Laboratories International, Inc. (NYSE:CRL) stock closed at $144.71 per share, with a market capitalization of $7.206 billion.

Polen US SMID Company Growth Strategy stated the following regarding Charles River Laboratories International, Inc. (NYSE:CRL) in its Q1 2025 investor letter:

“Finally, we exited our position in Charles River Laboratories International, Inc. (NYSE:CRL), which has experienced disappointing performance both fundamentally and regarding the stock price. Charles River is the largest contract research organization (CRO) focused entirely on providing outsourced R&D functions for big and small biopharma companies on early-stage research before drug trials in people. We believe the large biopharma market is in a challenging position, which has led many customers to cut spending on early-stage/pre-clinical research. This has hurt Charles River disproportionately, given its focus. Since we believe the challenges are multi-year, we have lowered our earnings expectations and revisited our thesis. We ultimately decided the position was no longer as attractive relative to the opportunity set, and we used it as a source of funds.”

A laboratory scientist surrounded by drug-discovery equipment and resources.

Charles River Laboratories International, Inc. (NYSE:CRL) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 39 hedge fund portfolios held Charles River Laboratories International, Inc. (NYSE:CRL) at the end of the first quarter, which was 45 in the previous quarter. While we acknowledge the potential of Charles River Laboratories International, Inc. (NYSE:CRL) as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is as promising as NVIDIA but that trades at less than 5 times its earnings, check out our report about the undervalued AI stock set for massive gains.

In another article, we covered Charles River Laboratories International, Inc. (NYSE:CRL) and shared the list of worst performing stocks in the S&P 500 so far in 2025. Upslope Capital Management also sold its stake in Charles River Laboratories International, Inc. (NYSE:CRL) during Q1 2025. In addition, please check out our hedge fund investor letters Q1 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.