Wasatch Small-Cap Growth Fund Trails Q3 Rally as Letter Details Winners and Laggards

Overview

• The Investor Class fell 3.17% in Q3 2025 versus a 12.19% gain for the Russell 2000 Growth after a Federal Reserve rate cut lifted small caps.
• Medpace was the top contributor as shares rose on strong Q3 results and a guidance hike, with revenue of $659.9 million up 23.7% year over year.
• Fabrinet and Nova also contributed, with data-center and AI-linked demand cited; Fabrinet posted fiscal Q1 2026 revenue of $978 million up 22% year over year, and Nova reported Q3 revenue of $224.6 million up 25%.
• BellRing was the largest detractor after a club-channel partner expanded protein-shake shelf space to rivals; Wasatch said it maintained conviction following talks with management.
• Other drags included Shake Shack, tied to restaurant-stock weakness on consumer-spending worries, and Inspire Medical Systems, which Wasatch exited after reduced 2025 guidance and delays to the Inspire V rollout.