Below are billionaire Seth Klarman’s top 5 stock picks for 2021. To read our detailed analysis of the billionaire’s stock-picking performance and his latest moves, see Billionaire Seth Klarman’s Top 10 Stock Picks for 2021.
5. Fox Corporation (NASDAQ: FOXA)
Baupost Group reduced its position in Fox Corporation (NASDAQ: FOXA) during the fourth quarter to 5.95% of the overall 13F portfolio, according to the latest filings. Still, FOXA ranks 5th on the list of Seth Klarman’s top 10 stock picks for 2021. Shares of Fox grew sharply since the beginning of this year, thanks to revenue growth prospects for 2021.
Silver Ring Value Partners, which posted a return of 26.6% for the last 12 months, sold their position in Fox Corporation during the fourth quarter. Here is what Silver Ring Value Partners stated in their Q4 investor letter:
“I sold our investment in FOX during the quarter at a small loss and redeployed the proceeds into shares of Discovery Communications and Mednax. The main reason for my sale was a new competitive threat, which widened the range of likely company outcomes. Furthermore, it added a competitive threat to the existing threat of secular decline that the industry is already battling to overcome. The probability of being right on having two independent things work out for the company is much lower than of it overcoming just one problem.
Fox Corp gets a substantial majority of its profits from Fox News. This is a network with very inelastic demand which has appeal to the ~45% of the country with conservative political views. With President Trump having lost the election, he began to agitate his supporters to switch viewership to more right-wing news outlets that were being more supportive of him and his claims about the election. Furthermore, there has been talk of him launching or backing a competing network, fracturing the conservative audience.”