TimesSquare Capital Management, an equity investment management company, released its “U.S. Mid Cap Growth Strategy” first quarter 2025 investor letter. A copy of the letter can be downloaded here. At the beginning of 2025, a general sense of optimism prevailed among businesses and markets. The expectations for a pro-business atmosphere with reduced regulatory burdens boosted global markets in January. However, in February, delays and uncertainties surrounding U.S. policies led to a more cautious market response, culminating in a significant decline in March. In this environment, the strategy returned -3.29% (gross) and -3.48% (net) while the Russell Midcap Growth Index returned -7.12%. In addition, please check the fund’s top five holdings to know its best picks in 2025.
In its first-quarter 2025 investor letter, TimesSquare Capital U.S. Mid Cap Growth Strategy highlighted stocks such as Robinhood Markets, Inc. (NASDAQ:HOOD). Robinhood Markets, Inc. (NASDAQ:HOOD) is a financial services platform that allows users to invest in stocks, exchange-traded funds (ETFs), American depository receipts, options, gold, and cryptocurrencies. The one-month return of Robinhood Markets, Inc. (NASDAQ:HOOD) was 20.97%, and its shares gained 260.56% of their value over the last 52 weeks. On June 18, 2025, Robinhood Markets, Inc. (NASDAQ:HOOD) stock closed at $78.35 per share, with a market capitalization of $69.141 billion.
TimesSquare Capital U.S. Mid Cap Growth Strategy stated the following regarding Robinhood Markets, Inc. (NASDAQ:HOOD) in its Q1 2025 investor letter:
“Elsewhere, we benefited from a 12% gain from the online brokerage platform Robinhood Markets, Inc. (NASDAQ:HOOD). At the start of the year, increased monthly trading volumes for options, significant gains in equity trading, and both were eclipsed by the growth of customers trading cryptocurrencies. Mid-quarter, Robinhood reported surging revenue and earnings by exceeding $1 billion of quarterly revenues for the first time, and its premium Robinhood Gold membership ranks swelled. We trimmed the position as its shares climbed. Later in March, as the broader market sell-off dampened Robinhood’s assets under custody, we began to add back to our holdings.”
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Robinhood Markets, Inc. (NASDAQ:HOOD) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 76 hedge fund portfolios held Robinhood Markets, Inc. (NASDAQ:HOOD) at the end of the first quarter, which was 79 in the previous quarter. While we acknowledge the potential of Robinhood Markets, Inc. (NASDAQ:HOOD) 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 Robinhood Markets, Inc. (NASDAQ:HOOD) and shared the list of stocks Jim Cramer recently discussed. In addition, please check out our hedge fund investor letters Q1 2025 page for more investor letters from hedge funds and other leading investors. While we acknowledge the potential of HOOD as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you’re looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.
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Disclosure: None. This article is originally published at Insider Monkey.
