Parnassus Value Equity Fund Outperforms and Shifts Toward Health Care in Q3

Overview

• Parnassus reported a 7.46% net return for Q3 2025, beating the Russell 1000 Value Index’s 5.33% gain.
• The portfolio cut Information Technology exposure and increased Health Care weighting, noting investor concerns around AI at NICE even as it expects AI to drive the company’s long-term growth.
• The letter reaffirmed Novo Nordisk despite a profit warning and obesity-drug competition, citing potential catalysts including an oral GLP-1 launch.
• Abbott was highlighted for durable growth prospects in diabetes care, heart health and electrophysiology supported by innovation and a diversified model, while Stryker was cited for MedSurg launches, growing robotics adoption and profitability progress under CEO Kevin Lobo.
• The fund sold D.R. Horton and redeployed to Home Depot to favor home improvement, pointing to better risk-adjusted returns supported by mortgage lock-in dynamics and an aging housing stock.