In this article, we discuss the 5 best stocks to buy according to billionaire Seth Klarman. If you want to read Klarman’s thoughts on how to navigate the current market and see his top 15 stock picks, please visit 15 Best Stocks to Buy According to Billionaire Seth Klarman.
5. Union Pacific Corporation (NYSE:UNP)
Baupost Group’s Stake: $376 Million
Union Pacific Corporation (NYSE:UNP) is a recent addition to the 13F portfolio of Baupost Group. The fund owned a stake in the railroad firm back in the second quarter of 2023, but disposed of it in the subsequent quarter. A new position was opened in the stock in the third quarter of 2025, consisting of 1.5 million shares. In the fourth quarter, this holding was increased by close to 9% to 1.63 million shares. This stake accounts for nearly 7% of the 13F portfolio of Baupost. In earnings for the fourth quarter of 2025, Union Pacific said it was planning $3.3 billion for 2026 capital improvements, expected to improve operating ratio versus 2025.
Union Pacific Corporation (NYSE:UNP) management also acknowledged macroeconomic headwinds, noting that the S&P Global’s 2026 economic estimates in key areas such as industrial production, housing starts and auto sales had deteriorated. Specific to 2026, the earnings outlook was set at the mid-single-digit range amid volume and cost headwinds.
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Union Pacific Corporation (NYSE:UNP) operates in the railroad business in the United States. It offers transportation services for grain and grain products, fertilizers, food and refrigerated products, and coal and renewables to grain processors, animal feeders, and ethanol and renewable biofuel producers, and construction products.
4. Elevance Health Inc. (NYSE:ELV)
Baupost Group’s Stake: $445 Million
Even though Baupost Group has trimmed a stake in Elevance Health Inc. (NYSE:ELV) by 4% during the fourth quarter of 2025, compared to filings for the previous quarter, the holding still represents the fourth-largest position of the fund in the 13F portfolio. It comprises more than 1.2 million shares. Baupost first bought shares in the company at the beginning of 2025. Back then, the stake consisted of 246,000 shares. The fund then proceeded to add to this stake by 150% and 114% in the subsequent quarters. In earnings for the fourth quarter of 2025, Elevance said it was targeting at least $25.50 adjusted EPS for 2026 amid margin recovery and portfolio repositioning.
The value inherent in stocks like Elevance Health Inc. (NYSE:ELV) is not visible to most investors. Klarman, in his book Margin of Safety, outlines his position on value investing very clearly. He says, “there is nothing esoteric about value investing. It is simply the process of determining the value underlying a security and then buying it at a considerable discount from that value. It is really that simple. The greatest challenge is maintaining the requisite patience and discipline to buy only when prices are attractive and to sell when they are not, avoiding the short-term performance frenzy that engulfs most market participants.”
Elevance Health Inc. (NYSE:ELV) operates as a health benefits company in the United States. It offers a variety of health plans and services to individual, employer group risk-based and fee-based, BlueCard, Medicare, Medicaid, and FEP members.
3. Willis Towers Watson Public Limited Company (NASDAQ:WTW)
Baupost Group’s Stake: $446 Million
Willis Towers Watson Public Limited Company (NASDAQ:WTW) is a long-term holding of Baupost Group, having featured in the 13F portfolio of the fund consistently since early 2021. Back then, this holding comprised close to 2.5 million shares. Since then, however, Klarman has trimmed this stake. The filings for the fourth quarter of 2025 show that the fund owns 1.36 million shares in Willis Towers. The latest filings further reveal that between October and December 2025, the fund increased the holding by 25% compared to filings for the third quarter of 2025. It is the third-largest position of Baupost, representing 8.45% of the 13F portfolio.
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Willis Towers Watson Public Limited Company (NASDAQ:WTW) is not a famous company and is often favored by value investors who seek long-term growth. Klarman, one of the best in the business at value investing, has some advice for those trying to replicate his success. In his book Margin of Safety, Klarman notes that value investing by its very nature is contrarian. Per the billionaire, out-of-favor securities may be undervalued; popular securities almost never are. He adds that what the herd is buying is, by definition, in favor. Securities in favor have already been bid up in price on the basis of optimistic expectations and are unlikely to represent good value that has been overlooked, he underlines.
Willis Towers Watson Public Limited Company (NASDAQ:WTW) operates as an advisory, broking, and solutions company worldwide. It offers strategy and design consulting, plan management service and support, broking and administration services for health, wellbeing, and other group benefit programs.
2. Amazon.com, Inc. (NASDAQ:AMZN)
Baupost Group’s Stake: $490 Million
Amazon.com, Inc. (NASDAQ:AMZN) has featured in the 13F portfolio of Baupost Group since the middle of 2022. However, the fund has not held onto this holding for the long-term. The 13F filings for the fourth quarter of 2025 show that the fund has purchased a stake in the company comprising over 2 million shares. This is the second-largest holding in the portfolio. Amazon has made a comeback in the Baupost portfolio after a gap of more than two years. Previously, Baupost had held under 1 million shares of Amazon at the end of 2022. The latest buzz around Amazon founder Jeff Bezos might explain Klarman’s sudden interest in the stock.
According to reports from The Wall Street Journal, Amazon.com, Inc. (NASDAQ:AMZN) founder Jeff Bezos is in the process of raising $100 billion for a new fund intended to buy up manufacturing and industrial businesses and then upgrade them with artificial intelligence tools. Per the report, the fund is intended to be a manufacturing transformation vehicle. It will buy companies involved in chipmaking, defense, and aerospace.
Amazon.com, Inc. (NASDAQ:AMZN) engages in the retail sale of consumer products, advertising, and subscriptions service through online and physical stores in North America and internationally. It also manufactures and sells electronic devices, including Kindle, fire tablets, fire TVs, echo, ring, blink, and eero, and develops and produces media content.
1. Restaurant Brands International Inc. (NYSE:QSR)
Baupost Group’s Stake: $551 Million
Restaurant Brands International Inc. (NYSE:QSR) is a relatively recent addition to the 13F portfolio of Baupost Group. The fund purchased a small stake in the company back in late 2024, consisting of just over 28,000 shares. In the subsequent quarters, the fund has aggressively bought additional shares of Restaurant Brands, adding to the initial holding in four of the last five quarters. Filings for the fourth quarter of 2025 show that Baupost has reduced this holding by just 2% compared to filings for the previous quarter. The stake still comprises over 8 million shares and represents more than 10% of the total 13F portfolio of the fund.
At an Investor Day event held at the end of February, Restaurant Brands International Inc. (NYSE:QSR) announced that it plans to become a 99% franchised business and set a goal of 1,800 net new restaurants per year by 2028. Billionaire Seth Klarman, who holds a sizable stake in the firm, has talked about high returns businesses with stable cash flows, applicable to the business model of Restaurant Brands. Klarman, in his book Margin of Safety: Risk-Averse Value Investing Strategies for the Thoughtful Investor, published in 1991, said for investing, at times a particular method may stand out as the most appropriate. Net present value would be most applicable, per Klarman, in valuing a high-return business with stable cash flows such as a consumer-products company.
Restaurant Brands International Inc. (NYSE:QSR) operates as a quick service restaurant company in Canada, the United States, and internationally. It operates through six segments: Tim Hortons, Burger King, Popeyes Louisiana Kitchen, Firehouse Subs, International, and Restaurant Holdings.
While we acknowledge the risk and potential of QSR as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than QSR and that has 10,000% upside potential, check out our report about this cheapest AI stock.
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