Baupost Group, the hedge fund managed by Seth Klarman has investments in 18 stocks in the first quarter of 2013, based on its 13F filing with the Securities and Exchange Commission. The market value of its portfolio is more than $2.93 billion.
In a letter to investors last month, he warned against the false calm in the United States and the trend of joining the bandwagon of quantitative easing (QE).
Klarman said the performance of Baupost in the first quarter was good, and it continues to benefit from the liquidation of the debt of Lehman Brothers Holdings Inc. (OTCMKTS:LEHMQ) and increased its cash balance by 2 percent. According to him, the strength of the hedge fund comes from its long-term investments and its risk-averse strategy with lower-leverage compared with other firms.
During the first quarter of the current fiscal year, Baupost bought two new stocks, and boosted its stake in four companies. The hedge fund reduced its stock holding in five stocks and sold out its entire position in three stocks.
Baupost New Stockholdings
Baupost acquired 9,126, 227 shares of Elan Corporation Plc (NYSE:ELN) Klarman purchased its stake in the Irish biotechnology company at a price range of $9.40 and $12 per share or at an average price of $10.85 per share. Elan Corporation represents 3.67 percent of its portfolio.
The hedge fund also bought 207,300 shares of DIRECTV (NASDAQ:DTV) at a price range of between $47.77 and $57.24 per share or at an average price of $51.90 per share. The satellite television provider’s total returns year-to-date is 28.41 percent compared with the S&P 500 total returns of 16.64 percent. DIRECTV has $36.84 billion market capitalization.
Baupost Increased Stockholdings
Klarman’s hedge fund increased its stake in Rovi Corporation (NASDAQ:ROVI) by 97.34 percent or 4,025,026 shares. Its total stockholdings in the company is 8,160,000 shares, and accounts 5.96 percent of its portfolio. Baupost first invested in the company in the third quarter of 2012.
Baupost boosted its position in American International Group (NYSE:AIG) by 4,850, 200 shares bringing its total stake in the insurance giant to 11,850, 200 shares. The stock represents 15.68 percent of its portfolio. Over the 52-week range, the stock price of AIG rose from $27.18 per share to $46.19 per share.
The hedge fund also acquired additional 5,337,300 shares of Idenix Pharmaceuticals Inc (NASDAQ:IDIX) making its total stake to 26,042,000 shares. Baupost initially bought 1,225,700 shares in the pharmaceutical company in second quarter of 2011. Idenix Pharmaceuticals is focused on developing medicines to treat patients suffering with viral diseases.
It also purchased additional 6,198,900 shares of BP Plc (NYSE:BP). Its total position in the energy company is 17, 126, 858 shares. Its market capitalization is $136.62 billion. Over the 52-week range, BP’s stock price climbed from its lowest level at $36.25 per share to its highest price at $45.45 per share.
Reduced and Sold Out Positions
During the period, Baupost reduced its stockholdings in the following companies: Enzon Pharmaceuticals Inc (NASDAQ:ENZN) by 158,918 shares, Alliance One international Inc (NYSE:AOI) by 655,106 shares, Ituran Location & Control Ltd (NASDAQ:ITRN) by 348,663 shares, Oracle Corp (NASDAQ:ORCL) by 7,057, 195 shares, and News Corp CL B (NASDAQ:NWS) by 8,973, 200 shares.
The hedge fund sold out its entire stake in Genworth Financial Inc (NYSE:GNW), News Corp (NASDAQ:NWSA), and Allied Nevada Gold Corp (AMEX:ANV).