What Makes Cidara Therapeutics (CDTX) an Investment Bet?

Baron Funds, an investment management company, released its “Baron Health Care Fund” third-quarter 2025 investor letter. A copy of the letter can be downloaded here. The fund rose 5.39% (Institutional Shares) in the quarter, compared to a 5.05% gain for the Russell 3000 Health Care Index (benchmark) and an 8.18% gain for the Russell 3000 Index (the Index). The Fund performed similarly to the Benchmark this quarter. Solid stock selection was primarily offset by negative effects from active sub-industry allocations and cash holdings during a rising market. In addition, please check the fund’s top five holdings to know its best picks in 2025.

In its third-quarter 2025 investor letter, Baron Health Care Fund highlighted stocks such as Cidara Therapeutics, Inc. (NASDAQ:CDTX). Cidara Therapeutics, Inc. (NASDAQ:CDTX) is a biotechnology company. The one-month return of Cidara Therapeutics, Inc. (NASDAQ:CDTX) was 0.55%, and its shares gained 674.74% of their value over the last 52 weeks. On November 3, 2025, Cidara Therapeutics, Inc. (NASDAQ:CDTX) stock closed at $102.73 per share, with a market capitalization of $2.605 billion.

Baron Health Care Fund stated the following regarding Cidara Therapeutics, Inc. (NASDAQ:CDTX) in its third quarter 2025 investor letter:

“We bought shares ofCidara Therapeutics, Inc. (NASDAQ:CDTX), a biotechnology company that is developing an antiviral drug to prevent flu. Cidara’s drug is not a vaccine. Rather, it’s a long-acting antiviral with the potential to be a single-dose, universal preventative against all flu strains. The drug acts by binding to a target on the virus cell surface, inhibiting the virus from replicating. In June, Cidara announced positive top-line results from its 5,000-plus person Phase 2b clinical trial evaluating its drug for the prevention of seasonal flu in healthy unvaccinated adults. A single dose of the antiviral gave up to 76% protection from symptomatic influenza over 24 weeks compared to placebo. The drug was also well-tolerated with no safety issues. By comparison, on average, flu vaccines cut infections by only about 40%, depending on the season, and vaccine efficacy is just 10% to 20% in the immunocompromised population. Cidara recently started enrolling a Phase 3 trial in adults over age 65 and in people over the age of 12 with high risk co-morbidities or immune compromised status. The company’s addressable market consists of more than 100 million people in the U.S. Management also believes the cost of manufacturing the drug will enable the company to achieve an attractive gross margin.”

Cidara Therapeutics, Inc. (NASDAQ:CDTX) is not on our list of 30 Most Popular Stocks Among Hedge Funds. According to our database, 34 hedge fund portfolios held Cidara Therapeutics, Inc. (NASDAQ:CDTX) at the end of the second quarter, up from 17 in the previous quarter. While we acknowledge the risk and potential of Cidara Therapeutics, Inc. (NASDAQ:CDTX) 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 Cidara Therapeutics, Inc. (NASDAQ:CDTX) and that has 10,000% upside potential, check out our report about this cheapest AI stock.

In another article, we covered Cidara Therapeutics, Inc. (NASDAQ:CDTX) and shared the list of hot growth stocks to invest in. In addition, please check out our hedge fund investor letters Q3 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.