Headwaters Capital Management, an investment management company, released its second-quarter 2025 investor letter. A copy of the letter can be downloaded here. The portfolio bounced back from the first quarter uncertainty and, like the rest of the market, experienced a strong rebound after the tariff-induced sell-off at the start of the quarter. The portfolio gained +7.5% (+7.3% net) in the quarter compared to a +8.5% gain for the Russell Mid Cap Index. In addition, you can check the fund’s top 5 holdings to determine its best picks for 2025.
In its second quarter 2025 investor letter, Headwaters Capital Management highlighted stocks such as Bio-Techne Corporation (NASDAQ:TECH). Bio-Techne Corporation (NASDAQ:TECH), with a market capitalization of $8.249 billion, develops, manufactures, and sells life science reagents, instruments, and services for the research and clinical diagnostic markets. The one-month return of Bio-Techne Corporation (NASDAQ:TECH) was 6.30%, and its shares lost 34.08% of their value over the last 52 weeks. On July 14, 2025, Bio-Techne Corporation (NASDAQ:TECH) stock closed at $52.62 per share.
Headwaters Capital Management stated the following regarding Bio-Techne Corporation (NASDAQ:TECH) in its second quarter 2025 investor letter:
“Buy: Bio-Techne Corporation (NASDAQ:TECH): A new position was added early in July and will be detailed in the Q3 letter. Summary Thesis: 1) Market leading life sciences reagents and instrument company. Recurring consumable revenue, strong profit margins, healthy free cash flow and a net cash position. 2) Concern around US academic funding is weighing on shares of TECH, pressuring the stock to its lowest valuation since 2017. 3) Revenue growth rate inflecting higher in FY ’27 (6/30 FYE) as Company laps one-time NIH budget reset and growth assets propel consolidated revenue. 4) Coveted asset as evidenced by recent M&A transactions, which supports a significantly higher valuation than implied by current share price.
