Baron Capital US Small Cap Fund

Novanta Inc. (NOVT) sells highly engineered photonics, vision, and precision motion-control solutions to original equipment manufacturers (OEMs) serving the medical and advanced industrial markets.
Novanta’s portfolio of proprietary, mission-critical components supports long-term OEM customer relationships. The company is positioned to deliver mid- to high-single-digit organic growth, driven by secular trends including surgical robotics, minimally invasive surgery, and broader automation. Continued focus on operational excellence should drive expansion in gross and operating margins. Acquisitions remain a core element of the strategy and the primary use of capital, with Novanta targeting high-quality, complementary assets that offer both revenue and cost synergies.

Guidewire Software, Inc. (GWRE) is a leading provider of core systems software to the global property and casualty (P&C) insurance industry.
Guidewire is a small player in a vast addressable market and benefits from P&C insurers’ need to upgrade 30-year-old systems. The company offers best-in-class functionality, as evidenced by its growing installed base and near-100% retention rates. After a multi-year transition period, we think Guidewire’s cloud migration is largely complete, and we expect accelerating revenue, expanding margins, and improving free cash flow over the next several years. We believe recent M&A in the vertical software space supports a meaningful value creation opportunity for shareholders.

Agilysys, Inc.

Enpro Inc. (NPO) is an industrial technology company that offers gaskets and seals for industrial applications, as well as advanced manufacturing, cleaning, coating, refurbishment, and related services for the semiconductor industry.
Enpro has transformed its business over the past five years, divesting more than $1 billion in assets and acquiring over $1.4 billion to improve its end-market mix, growth and margin profile, and competitive moat. Enpro’s industrial businesses focus on high-margin, niche applications with recurring demand, served through industry-leading brands. The semiconductor segment is well positioned to benefit from leading-edge investments and the reshoring of semiconductor production to the U.S. Continued accretive acquisitions remain central to the company’s strategy.

Hinge Health, Inc.

Liberty Media Corporation - Liberty Live (LLYVK) consists of Liberty Media Corporation's 30% interest in Live Nation Entertainment, Inc., the world's largest live entertainment company, producing, selling, and promoting concerts, and connecting brands to music.
Live Nation is the dominant player in an industry with solid long-term demand trends. The company has significant opportunities for capital reinvestment. Its investment in new owned and operated venues drives higher concert segment margins relative to shows held at third-party venues, largely due to Live Nation's control of the profitable food and beverage business. As Live Nation's mix shift to owned venues increases, we believe the resulting margin improvement will produce low double-digit growth in adjusted operating income over the long term.

Vertiv Holdings Co (VRT) is a pure-play full-service provider of digital-critical infrastructure solutions for the data center and communications end markets.
As the leader in critical infrastructure solutions for data centers, Vertiv is positioned to exceed end-market growth due to its strong competitive advantage, particularly in liquid cooling, which is essential for AI data centers given the increased energy density of the servers. We expect Vertiv to leverage its healthy contribution margins and strong execution to boost profits, driving robust free cash flow generation that the company could deploy into share buybacks or M&A to create additional value.

RadNet, Inc. (RDNT) is the leading U.S. provider of freestanding outpatient diagnostic imaging services and related IT solutions, based on the number of locations and annual imaging revenue, with 366 centers across key markets including Arizona, California, Delaware, New Jersey, New York, and Texas.
RadNet’s growth is driven by aging U.S. demographics, greater use of imaging in disease diagnosis and treatment, and the shift from inpatient imaging to lower-cost outpatient settings. The company builds leading positions in regional markets to leverage operational efficiencies through relationships with payors, radiology groups, and referring physicians. RadNet’s multi-modality strategy diversifies revenue streams and reduces reimbursement risk, while its AI capabilities enhance radiologic reads, supporting earlier disease detection and improving physician productivity.

Cognex Corporation (CGNX) is a leading provider of machine vision systems used in factory automation across the automotive, consumer electronics, logistics, and health care industries. Its machine vision products help manufacturers improve quality, reduce production errors, and lower manufacturing costs.
Machine vision is a foundational technology that underpins advancements in AI, robotics, next-generation automotive production, e-commerce fulfillment, product traceability, counterfeit prevention, consumer electronics manufacturing, and life sciences. Cognex is the global leader in machine vision and invests heavily in R&D to sustain its leadership and expand into new markets. The company’s competitive advantages include deep engineering expertise, an extensive patent portfolio, a strong distribution network, and the ability to service customers worldwide.

SiteOne Landscape Supply, Inc. (SITE) is the largest wholesale distributor of landscape supplies in North America. Through its large branch network, the company offers a broad selection of products across irrigation, agronomics, hardscapes, and nursery to landscaping professionals.
While SiteOne is over three times the size of its closest competitor, it has only high-teens share of a highly fragmented market. It has significant opportunity to further consolidate the industry through accretive acquisitions, driven by an experienced management team with a strong M&A track record. With the company’s renewed focus on execution and improving underperforming branches, we expect margin expansion to accelerate in the coming years. It is also investing in technology and productivity initiatives to enhance the customer experience and improve sales efficiency.

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