Below you find the top 5 value stocks according to Seth Klarman. For a more comprehensive list, please see billionaire Seth Klarman’s top 10 value stocks to buy now.
5. ViacomCBS (NASDAQ: VIAC)
ViacomCBS (NASDAQ: VIAC), which was previously known as CBS Corporation, continues to gain Seth Klarman’s confidence as the broadcasting company plans to aggressively expand its operations. It is the fifth-largest investment of Baupost Group, accounting for 5.70% of the portfolio.
Although the hedge fund has made no change in its position during the September quarter, Baupost Group has significantly added to its position in the past few quarters.
Shares of ViacomCBS soared sharply in the last six months, but its shares are still down 14% year to date. The broadcasting company has generated 85% revenue growth in the latest quarter. The company’s move towards the streaming business helped in enhancing the revenue growth in the latest quarter. ViacomCBS is a good stock to hold because it offers a dividend yield above 2.5%.
4. Viasat, Inc. (NASDAQ: VSAT)
Billionaire investor Seth Klarman appears to be the biggest fan of broadband and communications products provider Viasat (NASDAQ: VSAT). Baupost Group first initiated a position in Viasat in 2008. The hedge fund has added to its existing position during the third quarter after more than a 50% drop in share price this year. It currently represents the fourth largest investment of Klarman, accounting for 6.04% of the overall portfolio.
Shares of broadband and communications products provider have been under pressure this year due to slowing demand and softening outlook. The intense market competition also played a big role in negative revenue growth trends.
Its revenue has been hanging around $5.5 million over the past several quarters. The pandemic related challenges have also impacted Viasat performance in the past few quarters. Viasat shares are currently trading around $34, down 40% in the past five years and 20% in the last ten years.
3. Fox Corporation (NASDAQ: FOXA)
Baupost Group has initiated a position in Fox Corporation (NASDAQ: FOXA) at the beginning of 2018 and it currently represents its third-largest investment valued at $750 million. Klarman has dropped its stake by 1% in news, sports, and entertainment company during the third quarter.
Shares of Fox Corporation have been under pressure over the past two years amid strong market competition and slow revenue growth. The company has generated only 2% revenue growth in the latest quarter as pandemic has lowered its revenue from sports activities.
The company says, “We have successfully adapted to changes in the sports calendar and entertainment production schedules to deliver key programming to audiences and advertisers across FOX, most notably at our local television stations where political advertising will have achieved a record for any election.”
2. Liberty Global plc (NASDAQ: LBTYK)
British-Dutch-American multinational telecommunications company Liberty Global (NASDAQ: LBYT) is the second-largest stock holding of Baupost Group, according to the latest filings. Liberty Global currently holds 12.09% space in Klarman’s portfolio valued at $1.12 billion. The firm first initiated a position during the third quarter of 2018 and it has left its position unchanged in the latest quarter.
Liberty Global’s share price is up 10% this year. The investors have appreciated the company’s move of acquiring Sunrise in Switzerland and a joint venture with Telefonica’s in the U.K. In addition, the British-Dutch-American multinational telecommunications company has also supported investor’s sentiments through its aggressive share buyback plans.
The CEO Mike Fries said, “As the COVID-19 pandemic has altered the way we all work and live, our fiber-rich networks continue to deliver seamless connectivity that has never been more crucial. During the quarter, we continued to see strong demand for our high-speed connectivity products, adding 37,000 new customer relationships and over 70,000 broadband subscribers.”
1. eBay (NASDAQ: EBAY)
The e-commerce company eBay (NASDAQ: EBAY) is the largest stock holding of Seth Klarman’s Baupost Group, according to the latest filings. The firm created a position in the online retailers in the fourth quarter of 2018 and it currently accounts for 16% of a portfolio valued at $1.5 billion. Klarman’s hedge fund has slashed its stake in eBay by 6% in the latest quarter.
Shares of eBay rose sharply this year as social distancing policies shifted consumer’s focus towards online platforms. eBay benefited from consumer’s move towards online platforms. Its revenue of $2.61 billion in the latest quarter jumped 25% from the previous year’s period, with expectations that revenue growth momentum will extend into the next years.
eBay’s strategy of offering dividends to its investors makes it a good stock to hold for the long-term. The internet stock currently offers a quarterly dividend of $0.16 per share, yielding above 1%. Its stock price soared 42% soar so far this year.
Please also see: Seth Klarman’s Top Stock Picks and Baupost Group is Betting on eBay (EBAY) Stock
