Red Rock Resorts (RRR) is Capitalizing on Its Durango Property

Baron Fund, an investment management company, released its Q4 2025 letter for “Baron Partners Fund”. A copy of the letter can be downloaded here. The Fund increased considerably in the fourth quarter, returning 19.07% (Institutional Shares). It outperformed both the Russell Midcap Growth Index (the Benchmark), which returned -3.70%, and the broader Russell 3000 Index, which returned 2.40% in the quarter. The Fund returned 24.86% in the calendar year, significantly outperforming the Russell Midcap Growth Index, which posted a return of 8.66%, and the Russell 3000 Index, which returned 17.15%. The Fund focuses on long-term investments in a non-diversified portfolio of well-managed growth businesses at attractive prices across market caps. It has consistently delivered strong absolute and relative performance over the long term. The Fund has seen substantial appreciation during good times and has preserved value during challenging periods. Please review the Fund’s top five holdings to gain insights into their key selections for 2025.

In its fourth-quarter 2025 investor letter, Baron Partners Fund highlighted stocks like Red Rock Resorts, Inc. (NASDAQ:RRR). Headquartered in Las Vegas, Nevada, Red Rock Resorts, Inc. (NASDAQ:RRR) develops and operates casino and entertainment properties. One-month return of Red Rock Resorts, Inc. (NASDAQ:RRR) was 7.95%, and its shares gained 29.51% of their value over the last 52 weeks. On February 10, 2026, Red Rock Resorts, Inc. (NASDAQ:RRR) stock closed at $66.79 per share, with a market capitalization of $6.874 billion.

Baron Partners Fund stated the following regarding Red Rock Resorts, Inc. (NASDAQ:RRR) in its fourth quarter 2025 investor letter:

"Finally, Red Rock Resorts, Inc. (NASDAQ:RRR), a casino owner and operator focused on the Las Vegas Locals market, spent over $800 million developing a new elite property, Durango, for this market. It successfully completed Durango and is now generating robust returns alongside strengthening performance across six core Las Vegas Locals casinos. The company continues to report strong visitation and robust slot and table game play, along with improving activity from uncarded and non-rewards customers. The company’s initiative of opening its Durango property is generating robust returns, and performance across the company’s six core casinos has strengthened as the Las Vegas Locals market absorbs Durango’s extra supply. Given the strength of the market, management continues to ramp up capital investment, which we believe should support ongoing revenue and EBITDA growth over the next several years. The stock appreciated 39.4% in 2025."

Red Rock Resorts, Inc. (NASDAQ:RRR) is not on our list of 30 Most Popular Stocks Among Hedge Funds. According to our database, 31 hedge fund portfolios held Red Rock Resorts, Inc. (NASDAQ:RRR) at the end of the third quarter, compared to 32 in the previous quarter. While we acknowledge the potential of Red Rock Resorts, Inc. (NASDAQ:RRR) 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 Red Rock Resorts, Inc. (NASDAQ:RRR) and shared Baron Small Cap Fund's views on the company in the last quarter. In addition, please check out our hedge fund investor letters Q4 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.