Sands Capital Global Growth Fund: On Holding AG's (ONON) Detraction Is a Function of Our Purchase Timing

Sands Capital, an investment management company, released its “Sands Capital Global Growth Strategy” second-quarter 2025 investor letter. A copy of the letter can be downloaded here. Global Growth adopts a flexible approach to identify the most promising growth companies worldwide. Global equities outperformed the MSCI ACWI in the quarter. The portfolio returned 21.7% in the quarter compared to 11.5% for the index. The second quarter results were the fourth best in both absolute and relative terms since its 2008 inception. You can check the fund’s top 5 holdings to know more about its best picks for 2025.

In its second-quarter 2025 investor letter, Sands Capital Global Growth Strategy highlighted stocks such as On Holding AG (NYSE:ONON). On Holding AG (NYSE:ONON) develops and distributes sports products. The one-month return of On Holding AG (NYSE:ONON) was -4.91%, and its shares lost 15.55% of their value over the last 52 weeks. On September 16, 2025, On Holding AG (NYSE:ONON) stock closed at $43.02 per share, with a market capitalization of $14.048 billion.

Sands Capital Global Growth Strategy stated the following regarding On Holding AG (NYSE:ONON) in its second quarter 2025 investor letter:

"The top individual absolute detractors were On Holding AG (NYSE:ONON), Atlassian, Nike, Builders FirstSource, and Carlisle Companies.

On Holding is an emerging premium global sportswear brand rooted in innovation, design, and sustainability. We purchased the business during the quarter, reflecting our positive view of the company’s opportunity to gain share in the fragmented global sportswear market. The detraction from investment results was largely a function of our purchase timing.

The company aspires to become the most premium brand in the category and is a direct beneficiary of two powerful secular trends: the growing preference for sport-infused, casual apparel and the shift toward premium products. Founded in Zurich by a former Ironman competitor, On initially focused on running footwear. Its first major innovation—patented cloud soles—helped drive strong adoption among athletes. In less than 15 years, On has become one of the 10 largest sports footwear brands."

On Holding AG (NYSE:ONON) is not on our list of 30 Most Popular Stocks Among Hedge Funds. According to our database, 42 hedge fund portfolios held On Holding AG (NYSE:ONON) at the end of the second quarter, compared to 53 in the previous quarter. While we acknowledge the potential of On Holding AG (NYSE:ONON) as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

In another article, we covered On Holding AG (NYSE:ONON) and shared the list of best footwear stocks to buy. In addition, please check out our hedge fund investor letters Q2 2025 page for more investor letters from hedge funds and other leading investors.

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Disclosure: None. This article is originally published at Insider Monkey.