In this article, we will take a look at the 5 high growth value stocks to buy according to Seth Klarman. To see more such companies, go directly to 12 High Growth Value Stocks to Buy According to Seth Klarman.
5. Willis Towers Watson Public Limited Company (NASDAQ:WTW)
Seth Klarman’s Stake Value: $212 million
Insurance firm Willis Towers Watson Public Limited Company (NASDAQ:WTW) recently posted its quarterly results, according to which the company saw a 6.4% revenue growth in the June quarter on a year-over-year basis. Adjusted EPS in the period came in at $2.05, missing estimates by $0.28.
The company also mentioned its 2023 outlook. Willis Towers Watson Public Limited Company (NASDAQ:WTW) expects to deliver mid-single digit organic revenue growth in the year. It also expects to deliver adjusted operating margin expansion for the full year 2023.
Seth Klarman owns a $212 million stake in Willis Towers Watson Public Limited Company (NASDAQ:WTW) as of the end of the second quarter. Overall, 32 hedge funds in Insider Monkey’s database of 910 funds reported owning stakes in Willis Towers Watson Public Limited Company (NASDAQ:WTW).
4. Warner Bros. Discovery, Inc. (NASDAQ:WBD)
Seth Klarman’s Stake Value: $316 million
Warner Bros. Discovery, Inc. (NASDAQ:WBD) shares have gained about 34% in 2023 through August 29.
As of the end of the second quarter of 2023, 67 hedge funds out of the 910 funds tracked by Insider Monkey had stakes in Warner Bros. Discovery, Inc. (NASDAQ:WBD).
Earlier in August Warner Bros. Discovery, Inc. (NASDAQ:WBD) posted second-quarter results. GAAP EPS in the quarter came in at -$0.51 missing estimates by $0.10. Revenue in the quarter jumped 5.4% year over year to $10.36 billion, missing estimates by $80 million.
3. Alphabet Inc. (NASDAQ:GOOG)
Seth Klarman’s Stake Value: $498 million
Seth Klarman’s hedge fund cut its stake in Alphabet Inc. (NASDAQ:GOOG) by about 29% in the second quarter but the firm still owns a $498 million stake in the company. Despite being one of the top mega-cap tech stocks, Alphabet Inc. (NASDAQ:GOOG) has huge growth opportunities due to its AI investments, Cloud and search dominance. Baird recently said that Alphabet’s counteroffensive against Microsoft in the AI domain is “taking shape.” Baird analyst Colin Sebastian has an Outperform rating and a $140 target on Alphabet Inc. (NASDAQ:GOOG).
Giverny Capital Asset Management made the following comment about Alphabet Inc. (NASDAQ:GOOG) in its second quarter 2023 investor letter:
“I have believed for a while that we’re better served with a lower weight to the tech giants – we own Alphabet Inc. (NASDAQ:GOOG) (8.1% of our model portfolio at the end of June) and Meta (5.2%) for a 13.3% exposure, or about half the Index’s weight in the giants. And while Alphabet’s 36% return for the first half and Meta’s 138% return were gratefully received, I’m pleased to report that if we strip out that contribution to our overall return, the other 23 stocks we own, constituting 85% of our portfolio (with cash making up the balance), were up 10.2% on a weighted basis.
GCAM owns two of the seven tech mega caps in Alphabet and Meta, and they enjoyed similar rises. As mentioned, Alphabet A&C shares rose 36% while Meta rose 138%. Together, they added 2.38 percentage points to the overall Index return, meaning these seven tech giants cumulatively generated 12.4 percentage points of return, or roughly three-quarters of the Index’s return.
Alphabet and Meta combined sport a $2.25 trillion market cap and between them should generate roughly $120 billion of pretax profit this year. That’s a multiple of 19 times pretax profit, a substantial discount to Microsoft and Apple, and an even larger discount to Amazon, Nvidia and Tesla.”
2. ViaSat, Inc. (NASDAQ:VSAT)
Seth Klarman’s Stake Value: $672 million
Communications solutions company ViaSat, Inc. (NASDAQ:VSAT) ranks 2nd in our list of the best high growth stocks to buy according to Seth Klarman. Earlier in August the company posted Q1 results. Revenue of ViaSat, Inc. (NASDAQ:VSAT) in the quarter totaled $779.8 million, which was a 35.6% year over year growth.
As of the end of the second quarter of 2023, 13 hedge funds tracked by Insider Monkey had stakes in ViaSat, Inc. (NASDAQ:VSAT). The biggest stakeholder of ViaSat, Inc. (NASDAQ:VSAT) was Bob Peck and Andy Raab’s FPR Partners which owns a $182.5 million stake in the company.
Cove Street Capital made the following comment about Viasat, Inc. (NASDAQ:VSAT) in its second quarter 2023 investor letter:
“You, the reader, might find it hard to believe that we are this far into the letter before having any mention of Viasat, Inc. (NASDAQ:VSAT). It is satisfying to see “alphaesque” work finally see the light of day or the darkness of space depending upon your angle, but we aren’t to the promised land yet. We believe the market is just waking up to what VSAT has been working towards. As a quick recap, VSAT has been one of our largest positions for a number of years and unfortunately became our largest long Covid exposure stock which we did not realize at the time. The bearish premise on Viasat has largely been that they are throwing up billions of dollars in the wrong geosynchronous orbit and returns will be eaten by Starlink and other low Earth orbit (LEO) entrants. That’s hard to disprove when the damn satellite isn’t in the air. Well after much delay and a few breathless moments at T-minus, Viasat launched the first of its three VST3 constellation satellites. Yours truly spent 3 days at Cape Canaveral with management and other interested parties in weather delayed futility. The launch finally happened the day after I returned home. We believe that launching and preparing the satellite for operation will begin a massive change: bringing hundreds of millions of dollars of non-earning assets online and turning on the cashflow stream that the company has said was coming all this time. And if that isn’t exciting enough, during the quarter, VSAT closed on its acquisition of Inmarsat, which may prove to be a master stroke….stay tuned. Why events like this cluster together is hard to know.
Amid the tens of billions that have been burnt in space investing in the last 3 years and the mystery of Starlink math and Amazon’s Kuiper existence, Viasat in our opinion is one of only a handful of investable assets in the sector. Being up more than 25% this year is barely getting started if one does some conservative math. And we are actively attempting not to succumb to the “been down so long it looks like up to me” refrain which is irrelevant to the actual value at hand. And it’s a good example of “sell or not” discipline which people ask us about when things are not going well. Uncertainty on many fronts is receding, a state much prized by an investment world that has problems seeing beyond 3 months, and we see material gains from current levels.”
1. Liberty Global Plc (NASDAQ:LBTYK)
Seth Klarman’s Stake Value: $799 million
Seth Klarman owns a $799 million stake in telecom company Liberty Global Plc (NASDAQ:LBTYK) as of the end of the June quarter. In July Liberty Global Plc (NASDAQ:LBTYK) posted second quarter results. Revenue in the period jumped about 5.7% year over year to $1.85 billion, beating estimates by $10 million. Reported loss in the quarter fell 122% on a YoY basis to $511.3 million. Adjusted EBITDA in the quarter fell by 7.4% year over year on a reported basis and 7.6% on a rebased basis to $601.4 million
As of the end of the second quarter of 2023, 36 hedge funds tracked by Insider Monkey had stakes in Liberty Global Plc (NASDAQ:LBTYK).
You can also take a peek at 15 Most Profitable Cutting Edge Technologies That Will Make You Rich and Dow 30 Stocks List: Ranked By Hedge Fund Bullishness Index.
