Baron Capital ETF Exits Wynn Resorts Stake for Texas Roadhouse

Baron Capital's Baron SMID Cap ETF has closed out its position in Wynn Resorts, replacing the casino operator's shares with Texas Roadhouse stock during the third quarter, according to Casino.org News.

The move was disclosed in a letter to investors of the exchange-traded fund, known by its ticker BSCM, written by portfolio managers Laird Bieger and Randy Gwirtzman. The pair did not explain why Wynn was dropped, but their broader commentary pointed to a shift in conviction toward consumer names.

In the letter, the managers said they remain positive on the fund's holdings overall, noting that aerospace investments should regain lost valuation multiples once conditions in the Middle East normalise and that defense investments could rebound after the November mid-term elections. They added that they believe the recent sell-off in consumer stocks has gone too far, calling it a chance to buy "high growth, high-quality consumer companies trading at trough valuations."

With Wynn removed, BSCM now holds no gaming stocks whatsoever.

Baron Capital had previously been vocal about its enthusiasm for Wynn. A different vehicle run by the firm, the mutual fund known as the Baron Discovery Fund, added the shares in the second quarter of 2025, and Wynn still represented 1.3% of that fund's holdings as of 30 September.

At the time of that purchase, Baron Capital argued the stock was being overlooked because of tariff-related concerns, and said it had the potential to double in value, could draw interest from an acquirer, and was not being given credit by markets for the company's planned integrated resort project in the United Arab Emirates.

Despite that earlier optimism, Wynn shares are down 31.7% over the past year, according to Casino.org News.

As an actively managed fund without index constraints, BSCM has latitude to add to positions it favours and exit ones it does not, which is how the Wynn stake was unwound in favour of Texas Roadhouse. The issuer describes the ETF's objective as pursuing long-term capital appreciation by investing in small- and mid-cap US growth companies across a range of industries, targeting what it calls emerging and established scalable businesses with diversified exposure and position sizing.

Baron Capital has not abandoned gaming entirely. Its flagship Baron First Principles ETF, trading under the ticker RONB, allocates 2.27% of its weight to Red Rock Resorts. The asset manager has been a long-term holder of Red Rock and has previously offered favourable commentary on the company's capital spending at its flagship Las Vegas casino resorts.