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GenAI disruption fears weigh on Morningstar as Baron Partners outperforms
Baron Partners Fund reported a 16.6% gain in Q2 2026, while Morningstar shares fell 9.8% in the same quarter.
Baron Partners Fund, described in its Q2 2026 letter published by Baron Capital, delivered a 16.61% gain in the quarter on institutional shares, outpacing the Russell Midcap Growth Index at 14.55% and the Russell 3000 Index at 15.44%. Year to date, the fund returned 10.40%, beating the Russell Midcap Growth Index’s 7.27%, and its one-year return reached 48.75% versus 6.17% for the Russell Midcap Growth Index and 22.82% for the Market Index, according to the letter cited by Yahoo Finance.
The fund said it maintains a concentrated approach, holding 28 companies with a focus on its top positions, which account for 74.1% of total investments. The median market capitalization of those companies is $20.9 billion, and the strategy targets growth businesses expected to double in value within 5 to 6 years using proprietary research, alongside leverage that can increase volatility.
Within that portfolio, Morningstar, Inc. (NASDAQ: MORN) was cited as a contributor to a quarterly decline. Yahoo Finance reports that Morningstar fell 9.79% during Q2 2026, contributing 0.17% to the fund’s overall drop, as investor concerns about generative AI disrupting Morningstar’s data and research businesses compressed valuation multiples.
On August 14, 2026, Morningstar closed at $207.41 per share with a market capitalization of $7.78 billion, the coverage notes. The article also highlights that Morningstar posted a one-month return of 20.76% but shares lost 19.78% over the past 52 weeks.
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