Soumya Eswaran
3 min read
In This Article:
Polen Capital, an investment management company, released its “Polen U.S. Small Company Growth Strategy” first-quarter 2025 investor letter. A copy of the letter can be downloaded here. In Q1 2025, optimism fueled by the Trump election shifted to fear and uncertainty due to apprehension about cost-cutting measures and emerging trade policies. In the first quarter, the fund delivered -10.53% gross, and -10.83% net of fees, compared to a -11.12% return for the Russell 2000 Growth Index. In addition, you can check the fund’s top 5 holdings to find out its best picks for 2025.
In its first-quarter 2025 investor letter, Polen U.S. Small Company Growth Strategy highlighted stocks such as Dutch Bros Inc. (NYSE:BROS). Dutch Bros Inc. (NYSE:BROS) operates and franchises drive-thru shops. The one-month return of Dutch Bros Inc. (NYSE:BROS) was 21.61%, and its shares gained 86.83% of their value over the last 52 weeks. On May 13, 2025, Dutch Bros Inc. (NYSE:BROS) stock closed at $70.23 per share with a market capitalization of $11.55 billion.
Polen U.S. Small Company Growth Strategy stated the following regarding Dutch Bros Inc. (NYSE:BROS) in its Q1 2025 investor letter:
"Dutch Bros Inc. (NYSE:BROS) is a drive-through coffee and beverage company with roughly 1,000 locations (and growing). The stock was up just shy of 30% on the back of compelling earnings headlined by better-than-expected comparable sales and full-year revenue guidance. Notably, the company does not appear to be experiencing headwinds from a weaker consumer amidst growing economic uncertainty. In fact, they saw a re-acceleration in comparable sales driven by impressive menu innovation, growing brand recognition, and higher throughput from digital ordering. We believe Dutch Bros has the potential to be a long-duration EPS growth business."
A closeup of a customer tasting a freshly-made cold brew coffee product from the company's shop.
Dutch Bros Inc. (NYSE:BROS) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 41 hedge fund portfolios held Dutch Bros Inc. (NYSE:BROS) at the end of the fourth quarter which was 37 in the previous quarter. Dutch Bros Inc.’s (NYSE:BROS) first quarter revenue was $355 million, an increase of 29% from Q1 2024. While we acknowledge the potential of Dutch Bros Inc. (NYSE:BROS) 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 cheapest AI stock.
