TimesSquare Capital Management, an equity investment management company, released its “U.S. Small Cap Growth Strategy” first-quarter 2025 investor letter. A copy of the letter can be downloaded here. In the quarter, the fund returned -9.41% (gross) and -9.64% (net), compared to a -11.12% return for the Russell 2000 Growth Index. There was a broad positive sentiment in the market at the beginning of 2025. Expectations for a pro-business and soft regulatory environment lifted global markets in January. However, delays and uncertainties surrounding U.S. policies led to a significant downturn in March. 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. Small Cap Growth Strategy highlighted stocks such as Day One Biopharmaceuticals, Inc. (NASDAQ:DAWN). Day One Biopharmaceuticals, Inc. (NASDAQ:DAWN) is a commercial-stage biopharmaceutical company. The one-month return of Day One Biopharmaceuticals, Inc. (NASDAQ:DAWN) was 0.80%, and its shares lost 53.29% of their value over the last 52 weeks. On June 20, 2025, Day One Biopharmaceuticals, Inc. (NASDAQ:DAWN) stock closed at $6.32 per share, with a market capitalization of $640.608 million.
TimesSquare Capital U.S. Small Cap Growth Strategy stated the following regarding Day One Biopharmaceuticals, Inc. (NASDAQ:DAWN) in its Q1 2025 investor letter:
“Our preferences among Health Care stocks are those companies providing novel therapies for unmet needs that deserve premium pricing, or specialized service providers. Day One Biopharmaceuticals, Inc. (NASDAQ:DAWN) develops and commercializes targeted therapies for patients with genetically defined cancers. Their lead drug Ojemda is used to treat certain types of brain tumors (gliomas) in patients six months and older. The launch has been promising with 280 patients on therapy in December. Despite its early success, there are concerns about the addressable market and prescribing patterns. We decided to sell out of the position, which declined by -35% for the time it was held in the quarter.”
A close-up of a scientist in a laboratory environment, working on a biopharmaceutical product candidate.
Day One Biopharmaceuticals, Inc. (NASDAQ:DAWN) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 39 hedge fund portfolios held Day One Biopharmaceuticals, Inc. (NASDAQ:DAWN) at the end of the first quarter, which was 36 in the previous quarter. While we acknowledge the potential of Day One Biopharmaceuticals, Inc. (NASDAQ:DAWN) 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 Day One Biopharmaceuticals, Inc. (NASDAQ:DAWN) and shared the list of best low-priced biotech stocks to buy. 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 DAWN 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.
