It’s been tough for active managers to stand out in the growth world. Runaway prices of the top index constituents, including the Magnificent Seven (Alphabet GOOGL, Amazon.com AMZN, Apple AAPL, Meta Platforms META, Microsoft MSFT, Nvidia NVDA, and Tesla TSLA), have pressured managers to reevaluate their understanding of market dynamics. However, there are many roads to investment success, and not all rely on a handful of stocks with lofty valuations. Here are three funds that invest in growth stocks but won’t overpay for them.
Valuation discipline is a defining feature of MFS Massachusetts Investors Growth Stock MIGFX. The fund, which has a Morningstar Medalist Rating of Bronze, focuses on owning durable, growing businesses that should provide some cushion when markets tumble. It owns household mega-cap names like Nvidia and Apple, but selectively so, and partly to mitigate the risk of diverging too far from the index. While the 10 largest stocks in the Russell 1000 Growth Index accounted for 61% of the index as of September 2025, the fund placed just 32% of assets in those companies and owned only four of the top 10. Either underweighting or not owning Amazon, Meta, Tesla, and, at times, Apple and Nvidia, has caused performance to lag, as evidenced by its below-average 10.9% return over the five years ended November 2025.
However, the fund’s ability to mitigate losses has served investors well. For instance, in 2022, the index and average peer fell nearly 30%, but this fund lost 19%. For a large-growth fund, it has done a relatively good job of following Warren Buffett’s first rule of investing: “Don’t lose money.”
For those who can handle more sector concentration, Bronze-rated T. Rowe Price Growth Stock PRGFX is worth considering. Manager Jim Stillwagon focuses on companies with an economic moat and a reasonable price relative to fundamentals, but he isn’t afraid to make high-conviction bets. As of October 2025, the portfolio kept 73% of assets in its top 10 holdings, including three positions over 10% each. Underweighting key benchmark constituents like Apple and Tesla weighed on relative performance, and the 2022 downturn had this fund suffering a rough year with a 40% decline under predecessor Joe Fath. Since August 2025, Stillwagon has been the sole lead. He follows a similarly research-intensive process but mixes steadier stocks into the basket of fast-growing companies. After scoring a top-quartile return in 2023, the fund’s performance has been closer to that of its peers. Its 16.4% trailing one-year return as of November 2025 was below the large-growth Morningstar Category median, all while having muted exposure to the Magnificent Seven relative to the index and peers.
Silver-rated Loomis Sayles Growth LGRRX may not count as contrarian given its long- and short-term outperformance, but it follows a contrarian process that does not rely on index concentration. Manager Aziz Hamzaogullari and his eight-person team follow a patient, price-sensitive investment process, favoring firms that produce reliable free cash flow growth. Recent moves reflect discipline around price. The team long considered Meta and Tesla to be too expensive, but in 2022, it confidently added to both and let them appreciate to become two of the top three positions as of September 2025. Management took a similarly prudent yet opportunistic approach to Boeing BA, which it picked up in early 2020 amid pandemic worries, and Nike NKE, added in July 2024 after a historic price drop. Even as the fund capped positions at 8% (10% since 2024) and the Russell 1000 Growth Index grew ever more concentrated, the team curated a diversified basket of stocks that helped the fund produce a 15% annualized return over the five years ended November 2025, outpacing about three-fourths of peers in the intensely competitive large-growth category.
This article first appeared in the December 2025 issue of Morningstar FundInvestor. Download a complimentary copy of FundInvestor by visiting this website.