Value Investor Seth Klarman Bought BP plc (ADR) (BP) and American International Group Inc (AIG), Sold News Corp (NWSA) During Q1

Selling Oracle. News Corp (NASDAQ:NWSA) wasn’t the only one of Klarman’s favorites from three months ago to get demoted during Q1, with Baupost cutting its stake in Oracle Corporation (NASDAQ:ORCL) by about two-thirds. The company’s most recent 10-Q showed flat performance versus a year earlier, but the stock carries a trailing earnings multiple of 16 (implying that at least some earnings growth is already priced into the stock). As a result Oracle Corporation (NASDAQ:ORCL) doesn’t look too exciting to us, and some of the company’s peers might be better values.

Rovi. Turning away from large caps, the fund increased its holdings of digital program guide and recommendations provider Rovi Corporation (NASDAQ:ROVI) to a total of 8.2 million shares. Wall Street analysts like the $2.4 billion market cap company, with consensus earnings forecasts implying a forward P/E of10 and a five-year PEG ratio of 0.9. However, revenue shrunk 10% in its most recent quarter compared to the same period in the previous year, while those projections assume an increase in earnings per share.

As a result, we’d have to see that Rovi Corporation (NASDAQ:ROVI) can sustain its current business and possibly provide some growth before considering it as a value stock. BP plc (ADR) (NYSE:BP) and American International Group Inc (NYSE:AIG) certainly look cheap, and we’d recommend that investors do further research on the companies, although in BP’s case in particular some industry peers may be better buys. As for Baupost’s big sales, they are certainly dependent on growing their earnings going forward but at least in the case of News Corp (NASDAQ:NWSA) we can see that recent performance has been good even without accounting for the potential benefits of the breakup.

Disclosure: I own no shares of any stocks mentioned in this article.