Seth Klarman of Baupost Group manages a 13F portfolio worth more than $5.2 billion at the end of the fourth quarter of 2025. The top holdings in his equity portfolio are concentrated in the consumer cyclical, technology, and industrial sectors.
In May 2025, Klarman sat down for a conversation with Goldman Sachs President and COO John Waldron, discussing the ways in which his value-oriented investment philosophy was playing out in the stock market. During the talk, Klarman underlined the basic margin of safety as a principle that he had not deviated from, noting that it was simply the idea that you want room to be wrong. He also highlighted the need for investors to understand differentiation. He claimed that the only way to outperform was to be different, and the only way to invest well long-term was to be differentiated from the crowd. Klarman also reflected on how his 1991 book Margin of Safety remains the “calling card” for his strategy today.
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He explained that while the markets had changed—particularly with the rise of private equity and rapid technological shifts—the psychological guardrails he used had stayed the same. While explaining downside protection, he emphasized that the Baupost Group did not just “add up” a margin of safety as a number, but constantly asked how well-protected a portfolio was against “the elements of risk.” Structural guardrails within his fund, per the billionaire, avoided leveraging the portfolio and sought to diversify across countries and asset classes so they were not making a singular bet on one outcome. Perhaps the most famous remark from Klarman during this interview was regarding the difficulty of remaining disciplined when “comps” (market comparisons) were blowing with the wind, noting that value investors must have a higher tolerance for being “lonely” in their positions.
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Our Methodology
To compile our list of the best stocks to buy according to billionaire Seth Klarman, we reviewed the latest 13F filings of Baupost Group. Next, we focused on the top 15 stocks in his portfolio. Data for the hedge fund sentiment surrounding each stock was taken from Insider Monkey’s Q4 2025 database of 1041 elite hedge funds.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 498.7% since May 2014, beating its benchmark by 303 percentage points (see more details here).
Seth Klarman of Baupost Group
Best Stocks to Buy According to Billionaire Seth Klarman
15. Molina Healthcare, Inc. (NYSE:MOH)
Baupost Group’s Stake: $108 Million
Molina Healthcare, Inc. (NYSE:MOH) is a new addition to the 13F portfolio of Baupost Group. This holding comprises more than 620,000 shares. In early February, the company had released earnings for the fourth quarter of 2025, with the management projecting 2026 premium revenue of approximately $42 billion. This is slightly lower than 2025. The management expects Medicaid 2026 rates to average approximately 4% and will not offset the medical cost trend projected at 5%. The guidance assumes Marketplace premium will decline by 50% and that Medicare and Marketplace segments combined present a headwind of $1 per share in 2026.
Molina Healthcare, Inc. (NYSE:MOH) CEO Joseph Zubretsky, while speaking during the earnings call, highlighted a Medicaid contract win in Florida, stating that the contract in this regard was expected to yield $6 billion in annual run rate premium and was expected to go live late 2026. He also noted active engagement in RFPs representing an active pipeline of $50 billion of new opportunities over the next few years.
Molina Healthcare, Inc. (NYSE:MOH) provides managed healthcare services to low-income families and individuals under the Medicaid and Medicare programs and through the state insurance marketplaces in the United States.
14. Herbalife Nutrition Ltd. (NYSE:HLF)
Baupost Group’s Stake: $119 Million
Herbalife Nutrition Ltd. (NYSE:HLF) is a staple in the 13F filings of Baupost Group since the end of 2022. Back then, this position comprised 2 million shares. It remained around the 2 million mark for two years before making a sudden jump to over 5 million in the second quarter of 2024. Filings for the fourth quarter of 2025 show that the fund has increased its position in the company by nearly 20% compared to filings for the third quarter, with the holding now consisting of close to 9.3 million shares with an average price of $10.59.
Klarman, in his book Margin of Safety, has detailed his investment approach towards stocks like Herbalife Nutrition Ltd. (NYSE:HLF) and others, highlighting that investors should usually refrain from purchasing a full position in a given security all at once. Per Klarman, those who fail to heed this advice may be compelled to watch a subsequent price decline helplessly, with no buying power in reserve. He adds that buying a partial position leaves reserves that permit investors to average down, lowering their average cost per share, if prices decline.
Herbalife Nutrition Ltd. (NYSE:HLF) provides health and wellness products in North America, Mexico, South and Central America, Europe, the Middle East, Africa, China, and the Asia Pacific. It offers weight management products, including meal replacement, protein shakes, drink mixes, weight loss supplements, healthy snacks, and metabolism boosting teas.
13. CRH plc (NYSE:CRH)
Baupost Group’s Stake: $134 Million
Since the third quarter of 2023, CRH plc (NYSE:CRH) has consistently appeared in the 13F filings of Baupost Group. Back then, this position consisted of 3.35 million shares, increasing to over 4 million by the middle of next year. However, the fund has trimmed this stake following this high. The 68% reduction in the fourth quarter of 2025, compared to filings for the third quarter of 2025, brings this holding down to just over a million shares, representing 2.54% of the 13F portfolio.
CRH plc (NYSE:CRH) released earnings for the fourth quarter of 2025 last month. The management of the firm projected full-year 2026 adjusted EBITDA between $8.1 billion and $8.5 billion, net income between $3.9 billion and $4.1 billion, and diluted EPS between $5.60 and $6.05. The firm also expects continued strong demand in transportation, water infrastructure, and reindustrialization, with particular optimism for US federal and state infrastructure funding and data center activity.
CRH plc (NYSE:CRH) provides building materials solutions in Ireland, the United States, the United Kingdom, rest of Europe, and internationally. The company offers building materials for the construction and maintenance of public infrastructure, and commercial and residential buildings, as well as construction and renovation of transportation infrastructure.
12. Fiserv, Inc. (NASDAQ:FISV)
Baupost Group’s Stake: $148 Million
Fiserv, Inc. (NASDAQ:FISV) first appeared in the Baupost 13F portfolio at the end of the fourth quarter of 2021. Back then, the holding comprised over 3 million shares. Klarman then added to this holding, growing it to nearly 4 million shares in the next quarter. However, by the middle of 2023, this stake had been sold off completely. A new position was then opened in the second quarter of 2025, comprising close to 900,000 shares. Baupost then added to this holding in the fourth quarter of 2025, growing it by more than 145% to 2.2 million shares. The company is a classic example of a value firm not paying a dividend. In his book Margin of Safety, Klarman has explained his reasoning behind investments in such firms. He says that stocks should simply not be bought on the basis of their dividend yield. Per Klarman, too often struggling companies sport high dividend yields, not because the dividends have been increased, but because the share prices have fallen. He adds that fearing that the stock price will drop further if the dividend is cut, management maintains the payout, weakening the company even more.
Fiserv, Inc. (NASDAQ:FISV) stock has jumped since mid-February amid reports that activist investor Jana Partners has built a stake in the company and is pushing for changes to boost the stock price. The stock had plunged in October 2025 as the Milwaukee-based fintech revamped its leadership, refreshed its board, slashed its full-year earnings guidance, and launched a new action plan after its Q3 earnings fell short of Wall Street consensus.
Fiserv, Inc. (NASDAQ:FISV) provides payments and financial services technology solutions in the United States, Europe, the Middle East and Africa, Latin America, the Asia-Pacific, and internationally.
11. Genuine Parts Company (NYSE:GPC)
Baupost Group’s Stake: $183 Million
Genuine Parts Company (NYSE:GPC) is a relatively new addition to the 13F portfolio of Baupost Group. The fund bought a stake in the company in the fourth quarter of 2024, comprising more than 300,000 shares. However, it was sold off completely in the subsequent quarter. A new position was then opened in the third quarter of 2023. In the fourth quarter of 2025, this position was further strengthened, with the fund adding 6% to the third-quarter stake. The strategy is typical of Klarman, who invests in value-oriented firms at a discounted value and then sells off the stake at peak prices. While explaining his motivation behind stock market investing in his book Margin of Safety, has said that many unsuccessful investors regard the stock market as a way to make money without working rather than as a way to invest capital in order to earn a decent return.
Genuine Parts Company (NYSE:GPC) shares have surged since the executives at the firm revealed earlier this month that they were considering splitting the company into two stand-alone public businesses to unlock faster growth, sharper capital allocation and better margin performance, and a growing push into artificial intelligence.
Genuine Parts Company (NYSE:GPC) distributes automotive and industrial replacement parts. It distributes automotive replacement parts, accessories, tools, equipment, and related solutions for hybrid and electric vehicles, trucks, buses, motorcycles, farm equipment, and heavy-duty equipment.
10. Eagle Materials Inc. (NYSE:EXP)
Baupost Group’s Stake: $245 Million
Eagle Materials Inc. (NYSE:EXP) has been featured in the 13F portfolio of Baupost since the first quarter of 2024. A look at the historical portfolio indicates that Baupost has been steadily increasing the position it has held in Eagle Materials over time, with the number of shares rising consistently from about 262k in early 2024 to roughly 1.19 million by late 2025, amid a brief pullback in the middle of the period, even as the overall trend remains upward. Filings for the fourth quarter of 2025 show that the fund increased the holding by 27% compared to filings for the previous quarter.
In late February, RBC Capital Markets analyst Anthony Codling initiated coverage of Eagle Materials Inc. (NYSE:EXP) stock with a Sector Perform rating and a $208 price target, contending that the company’s combination of heavy and light building materials operations is suppressing its valuation. Per the analyst, the firm may be worth significantly more apart than together. Codling estimates that as much as $88 a share, roughly 40% upside, is being left on the table because investors are applying a conglomerate discount to the business.
Eagle Materials Inc. (NYSE:EXP) manufactures and sells heavy construction products and light building materials in the United States. It engages in the mining of limestone for the manufacture, production, distribution, and sale of Portland cement.
9. Dollar General Corporation (NYSE:DG)
Baupost Group’s Stake: $274 Million
Dollar General Corporation (NYSE:DG) first made an appearance in the 13F portfolio of Baupost Group in 2023. Back then, it was a small position, consisting of just 242,000 shares, and was sold off before the end of the year. A new position was then opened in the third quarter of 2024. This holding comprised 2.3 million shares. At the end of the fourth quarter of 2025, the fund owned just over 2 million shares in the company, representing a decrease of more than 22% compared to filings for the previous quarter. Klarman, in his book Margin of Safety, has underlined his overall approach to investing in firms like Dollar General, noting that risk is not inherent in an investment but is always relative to the price paid.
Earlier this month, Dollar General Corporation (NYSE:DG) announced earnings for the fourth fiscal quarter, reporting earnings per share of $1.93, beating expectations by $0.29. The revenue over the period was $10.9 billion, up 5.8% compared to the revenue over the same period last year and topping expectations by $80 million.
Dollar General Corporation (NYSE:DG) is a discount retailer that provides various merchandise products in the southern, southwestern, midwestern, and eastern United States. The company offers consumable products, including paper towels, bath tissues, paper dinnerware, trash and storage bags, disinfectants, and laundry products.
8. Fidelity National Information Services, Inc. (NYSE:FIS)
Baupost Group’s Stake: $299 Million
Fidelity National Information Services, Inc. (NYSE:FIS) is one of the most featured stocks in the 13F history of Baupost Group. The fund first purchased a stake in the company in the third quarter of 2022, buying over 600,000 shares. It then proceeded on a buying spree, increasing this to close to 7 million shares in the third quarter of 2023. Subsequently, the stake was trimmed, and sold off completely by the fourth quarter of 2024. However, a new position was opened in early 2025. At the end of 2025, the fund held almost 4.5 million shares in the company, representing an increase of 19% compared to filings for the previous quarter.
In late February, Fidelity National Information Services, Inc. (NYSE:FIS) announced earnings for the fourth quarter of 2025. The firm projects 2026 adjusted revenue to grow 30% to 31% with EBITDA growing 34% to 35%. Management said the firm is well positioned to double free cash flow to over $3 billion by 2028, implying a compound annual growth rate of approximately 25%.
Fidelity National Information Services, Inc. (NYSE:FIS) provides solutions to financial institutions, businesses, and developers worldwide. It provides core processing and ancillary applications, mobile and online banking, fraud, risk management, and compliance.
7. Alphabet Inc. (NASDAQ:GOOGL)
Baupost Group’s Stake: $341 Million
Alphabet Inc. (NASDAQ:GOOGL) is one of the most prominent long-term holdings of Baupost Group. It first purchased a stake in the company in the first quarter of 2020, consisting of more than 6 million shares. Since then, the company has regularly featured in the 13F filings of the fund, with small fluctuations The filings for the fourth quarter of 2025 show that the fund owned just over 1 million shares in the company. Compared to the filings for the third quarter of 2025, the fund has reduced the holding by close to 42%.
Latest reports indicate that Alphabet Inc. (NASDAQ:GOOGL) plans to build a new data center in Michigan. The report further highlights a collaboration with DTE Energy to power the operations once construction is completed. The company said in a blog post that the data center would run on 2.7 gigawatts of new resources for the grid, including solar power and advanced power storage technologies.
Alphabet Inc. (NASDAQ:GOOGL) offers various products and platforms in the United States, Europe, the Middle East, Africa, the Asia-Pacific, Canada, and Latin America. The Google Services segment provides products and services, including ads, Android, Chrome, devices, Gmail, Google Drive, Google Maps, Google Photos, Google Play, Search, and YouTube.
6. WESCO International, Inc. (NYSE:WCC)
Baupost Group’s Stake: $347 Million
WESCO International, Inc. (NYSE:WCC) has been a consistent feature in the 13F portfolio of Baupost Group since the first quarter of 2024. Back then, this position comprised just over 200,000 shares. In the subsequent quarters and years, Baupost added to this stake, growing it to more than 2.2 million shares at one point in 2025. However, it has trimmed the holding following this high, decreasing it by 31% and 5% in the third and fourth quarter of 2025 respectively. It still comprises 1.42 million shares and accounts for 6.6% of the 13F portfolio of the fund.
Overall, the Baupost interest in WESCO International, Inc. (NYSE:WCC) reflects Klarman’s strategy of buying heavily into a cyclical, somewhat overlooked industrial business when it’s cheap, then trimming as the market re-rates it. In early February, the company announced that it would be targeting 20% EPS growth for 2026 while expanding data center momentum and leadership transition.
WESCO International, Inc. (NYSE:WCC) provides business-to-business distribution, logistics services, and supply chain solutions in the United States, Canada, and internationally. It offers electrical equipment and supplies, automation and connected devices, security, lighting, wire and cable, and safety, as well as maintenance, repair, and operating products.
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