Latest news with #Baupost
CNBC
a day ago
- Business
- CNBC
Seth Klarman's Baupost picks up beaten-down shares, raises Alphabet stake
Baupost Group's Seth Klarman picked up several beaten-down stocks last quarter, while increasing its big stake in Google parent Alphabet to take advantage of the rebound in technology. The widely-followed hedge fund manager took a new, $154 million stake in fintech services provider Fiserv , according to the latest regulatory filing. Fiserv recently nosedived after cutting its forecast for annual revenue growth, bringing the stock's six-month loss to 42%. Baupost also added a $51 million bet on packaging firm Amcor Plc and a $24 million stake in Brazilian payments company PagSeguro Digital in the second quarter. The Boston-based hedge fund also hiked its stake in Alphabet last quarter, by 27% to a holding worth $464 million at the end of June. Alphabet, whose shares rallied 14% in the second quarter, is now Baupost's second-largest position, trailing only Swiss mobile and broadband provider Sunrise Communications . Baupost's top holdings at the end of June also included Wesco International , Willis Towers Watson and asphalt and cement maker CRH PLC . The billionaire hedge fund manager has been an almost religious follower of Benjamin Graham's investing style, buying out-of-favor and undervalued assets to ensure a margin of safety. As a result, Klarman has drawn comparisons to Warren Buffett for his patient, disciplined approach, leading some to dub him "The Oracle of Boston" in a nod to "The Oracle of Omaha." The 68-year-old Harvard and Cornell grad published his investment book, "Margin of Safety," in 1991. A long out-of-print cult favorite, a used copy of "Margin of Safety" now fetches almost $4,000 on Amazon . Klarman recently helped update the investment bible " Security Analysis " by Benjamin Graham and David Dodd, written in 1934 in the depths of the Great Depression. Klarman co-founded Baupost in 1982 , when the firm had just $27 million in assets. It scored a 20% average annualized return for the next few decades, posting its best year in 2017, with a 52% return, specializing in buying distressed debt and mortgage securities that had bottomed. However, as growth stocks and technology shares have continued to lead the stock market after a decade of outperformance, value investors like Klarman have struggled with underperformance in recent years. Baupost has returned only about 4% a year in the last decade, and investors have withdrawn roughly $7 billion from the hedge fund over the past three years, according to Bloomberg News.
Business Insider
3 days ago
- Business
- Business Insider
Investing legend Seth Klarman talks about how his hedge fund is using AI: 'Essentially a capable assistant'
Artificial intelligence may one day upend whole industries, but among the hedge fund elite, it's not yet a threat, investing legend and Baupost Group CEO Seth Klarman said. In an episode of Columbia Business School's Value Investing with Legends podcast this month, the hedge fund titan said he and his colleagues mostly use the nascent technology as a time-saver, assigning it tasks that lower-level staffers may have done in the past. "We have ourselves started using it as essentially a capable assistant, a summer intern," Klarman said. "Not somebody who knows which stocks to buy, but a way to tabulate data quicker." Klarman cited a couple of specific examples of how his colleagues have used it. One way was to analyze corporate filings. "He asked AI to take a look at 10 years of annual reports for a company and compare what changed in the annual report from year to year — the way they communicate, which may reveal something about the change in the business, or what the lawyer was worried about, or whatever it might be," Klarman said. Another was to identify company logos that one of his employees had never seen that would help them know an industry landscape better. "He would have run that to an intern, but AI did it in like five minutes and saved three days' worth of work," Klarman said. Klarman also said he's been using AI himself, though he hasn't been particularly impressed. Before he was set to speak at an event with a well-known business executive, he asked a chatbot to generate some questions to ask the person. "What came back was useless," he said. "I like to ask things that they haven't thought about before." Baupost isn't the only firm using AI to increase efficiency. Morgan Stanley and Bank of America have started to train staff to use the technology to boost productivity. Consulting firm ThoughtLinks found in a recent study that by 2030, 44% of a bank's tasks, including 32% of sales and trading work, could be "redefined" by AI. Despite using the technology, Klarman said he's concerned that AI could hurt people's ability to be creative. A recent MIT study backed this up, finding that using AI reduced memory and brain activity. "I think that if we use AI the wrong way, we'll solve the problem without having applied our brains," Klarman said. "It would be like reading the end of a novel and then not needing to really know as well how did the whole thing come about? So I like doing it in order. I think the right order is, 'Here's what I think,' and then I can improve my thinking."
Mint
08-07-2025
- Business
- Mint
Baupost-Backed Tile Importer Files for Bankruptcy, Seeks Sale
(Bloomberg) -- Mosaic Cos., which sells tile and stone flooring, filed for bankruptcy with plans to sell its operations after the company's main backer, an affiliate of investment giant Baupost Group, was unable to help the business navigate import problems that began during the Covid-19 pandemic. Most of the tile and stone the company sells through design studios and home-improvement stores are imported, which exposed Mosaic to the shipping disruptions that snarled supply chains during the pandemic and the years that followed, the company said Tuesday in a court filing. As a result, it either had too little product, or too much to sell, according to Chief Executive Officer Randall Jackson. Mosaic's biggest outlet, Lowe's Home Improvement, refused to share added freight-cost burdens, pushing down the tile importer's margins, Jackson said. The company also blamed rising interest rates and, more recently, tariffs for its financial troubles. Mosaic was formed from a family business that Baupost agreed to back in 2019. As Mosaic tried to make its main brands — Walker Zanger and Opustone — profitable, Baupost invested an additional $42 million in 2022 and 2023, according to the court filing. Last year, Mosaic sold Opustone for about $100 million. The company has an agreement to sell its Walker Zanger business as part of the Chapter 11 proceedings. Under that deal the sale must be approved by the court within 45 days. The company owes lenders about $65 million and has unpaid supplier debt of about $5 million, according to court papers. The Walker Zanger division is also one of dozens of companies being sued by workers who claim they were exposed to hazardous products distributed by various tile and stone retailers. The company denies the allegations. The bankruptcy case is Mosaic Companies, LLC, 25-11296, US Bankruptcy Court, District of Delaware (Wilmington) More stories like this are available on
CNBC
15-05-2025
- Business
- CNBC
Seth Klarman's hedge fund Baupost adds a handful of value stocks, including a fintech name
Baupost Group's Seth Klarman took stakes in several underperforming stocks in the first quarter, including fintech name Fidelity National Information Services , according to a new regulatory filing with the SEC. The Boston-based hedge fund manager, who oversees roughly $28 billion in assets , built a $261 million stake in the financial services company in the first three months of 2025, making it his fifth largest holding. It could be a classic value play as Fidelity National fell 7.5% in the first quarter. The stock has since recovered some and was recently down 3% on the year. Baupost also added a $107 million stake in health insurance provider Elevance Health as well as a $71 million bet on Irish healthcare name Icon Plc in the first quarter. Elevance shares are down more than 1% in 2025, while Icon's stock has tumbled nearly 38%. Klarman, a follower of Benjamin Graham 's value investing style, has drawn comparisons to Warren Buffett for his patient, disciplined approach, leading some to dub him "The Oracle of Boston." The 67-year-old Harvard and Cornell grad published his now out-of-print investment guide, "Margin of Safety," in 1991. The book now sells for thousands of dollars online. As growth stocks and technology shares continue to lead the stock market even after a decade of outperformance, value investors like Klarman have struggled with underperformance in recent years. Baupost gained only about 4% a year since 2014, while investors have pulled roughly $7 billion from the hedge fund in the past three years, according to Bloomberg News. Baupost's top holdings at the end of March included John Malone's media conglomerate Liberty Global , Willis Towers Watson and Wesco International .
Yahoo
22-03-2025
- Business
- Yahoo
Wall Street Brokers Start Trading Insurer Claims From LA Fires
(Bloomberg) -- Wall Street brokers have started selling insurers' claims tied to Los Angeles' deadly wildfires, which may trigger a payout from the utilities blamed for the destruction, according to people familiar with the matter. New York Subway Ditches MetroCard After 32 Years for Tap-And-Go Despite Cost-Cutting Moves, Trump Plans to Remake DC in His Style LA Faces $1 Billion Budget Hole, Warns of Thousands of Layoffs Amtrak CEO Departs Amid Threats of a Transit Funding Pullback NYC Plans for Flood Protection Without Federal Funds Investors are buying so-called subrogation claims, obtaining an insurer's right to compensation from a utility if it's found liable for fire-related damage. The claims are meant to help insurance companies recover losses incurred from disasters. Investment firm Oppenheimer & Co. recently executed the first trade of subrogation claims tied to either the Eaton Fire or the Palisades Fire, according to people familiar, asking not to be identified discussing private information. It has brokered others since, said one of the people. Messages left with Oppenheimer were not returned. Cherokee Acquisition, an investment bank that helps insurers sell subrogation claims, has been 'very active' in brokering claims for the Eaton Fire, said Bradley Max, a director at the bank. The January wildfires are among the most destructive in California's history, killing at least 29 people and destroying parts of neighborhoods in Los Angeles County. More than 37,000 fire-related insurance claims have been filed and over $12 billion has been paid out, according to the California Department of Insurance. Residents who suffered losses from the fires have mainly sued two companies: electricity supplier Edison International Inc. and the Los Angeles Department of Water and Power, a municipal utility. LADWP was blamed for not supplying enough water to fight the Palisades Fire, and property owners allege that equipment owned by Edison caused the Eaton Fire. It's unclear whether the insurers' claims will pay out. While California law has a low bar to hold utilities responsible for fire damage, the causes of the LA blazes are under investigation in a process that could take months to complete. READ: LA Fire Victims Are Suing Utilities. What's at Stake?: QuickTake California wildfires have been linked to subrogation trades before. Seth Klarman's Baupost Group bought some claims against PG&E Corp. — the California utility that fell into bankruptcy in 2019 — for fires that started in 2017. Baupost bought $1 billion of claims for as much as 35 cents on the dollar from CSAA Insurance Group, Bloomberg reported. Baupost and others negotiated a settlement deal between the utility and insurers. Klarman's firm was estimated to gain at least $570 million from an $11 billion agreement, which implied a payout of roughly 55 cents on the dollar. A group of wildfire victims blasted the settlement, saying that PG&E prioritized 'wealthy hedge funds and Wall Street' over the victims. A portion of insurer claims linked to the deadly 2023 Maui wildfires were also sold to investors. Cherokee, the bank, brokered deals worth more than $77 million, Max said. A New 'China Shock' Is Destroying Jobs Around the World Tesla's Gamble on MAGA Customers Won't Work How TD Became America's Most Convenient Bank for Money Launderers The Real Reason Trump Is Pushing 'Buy American' One Man's Crypto Windfall Is Funding a $1 Billion Space Station Dream ©2025 Bloomberg L.P. Sign in to access your portfolio
