TimesSquare Capital Management, an equity investment management company, released its “U.S. Focus Growth Strategy” first quarter 2025 investor letter. A copy of the letter can be downloaded here. The broad-based downturn in US equities underperformed overseas markets in the first quarter. In this negative environment, the strategy outperformed the index in the first quarter. The strategy returned 2.42% (gross) and 2.20% (net) compared to a -7.12% return for the Russell Midcap Growth Index. 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. Focus Growth Strategy highlighted stocks such as Gartner, Inc. (NYSE:IT). Established in 1979, Gartner, Inc. (NYSE:IT) is a research and advisory company that operates through research, conferences, and consulting segments. The one-month return of Gartner, Inc. (NYSE:IT) was 14.22%, and its shares lost 1.76% of their value over the last 52 weeks. On May 16, 2025, Gartner, Inc. (NYSE:IT) stock closed at $448.29 per share with a market capitalization of $34.5 billion.
TimesSquare Capital U.S. Focus Growth Strategy stated the following regarding Gartner, Inc. (NYSE:IT) in its Q1 2025 investor letter:
Slipping by -14% was Gartner, Inc., which offers independent and objective research and analysis on information technology, computer hardware, software, and communications. While revenues and earnings were better than expected thanks to accelerating growth in contract values, Gartner’s outlook for the year was less than anticipated. From our experience, we have seen Gartner begin its fiscal years conservatively only to steadily improve its results, so we added to our position. There was weakness in Gartner’s shares later in the quarter when federal government cost cutting was projected to affect about 4% of Gartner’s revenues (though we believe that was a price overreaction).
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Gartner, Inc. (NYSE:IT) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 57 hedge fund portfolios held Gartner, Inc. (NYSE:IT) at the end of the fourth quarter which was 35 in the previous quarter. Gartner, Inc.’s (NYSE:IT) fourth quarter revenue was $1.7 billion, representing an 8% year-over-year increase. While we acknowledge the potential of Gartner, Inc. (NYSE:IT) 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.
