Seth Klarman (Trades, Portfolio), a much-followed value investor, said Friday evening that he had purchased three positions in the latest second quarter, according to a filing.
Klarman runs Boston-based Baupost Group where he oversees $30 billion and looks for underpriced companies. As one of his primary tenets of investing and the name of his book, margin of safety must be inherent in each stock.
In a recent letter, reported by The New York Times, Klarman expressed his concern about how Trump’s shoot-from-the-hip oratorical style might roil markets.
“’The big picture for investors is this: Trump is high volatility, and investors generally abhor volatility and shun uncertainty,’ he wrote. ‘Not only is Trump shockingly unpredictable, he’s apparently deliberately so; he says it’s part of his plan.’
While Mr. Klarman clearly is hoping for the best, he warned, ‘If things go wrong, we could find ourselves at the beginning of a lengthy decline in dollar hegemony, a rapid rise in interest rates and inflation, and global angst.’”
Overview of new positions
Avis Budget Group Inc. (CAR, Financial)
Klarman bought 4 million shares of the car rental company. The company traded for an average of $26 per share for the quarter, for a total cost of roughly $109.08 million.
Avis Budget Group Inc. has a market cap of $2.88 billion; its shares were traded around $34.79 Friday with a P/E ratio of 45.20 and P/S ratio of 0.34. Avis Budget Group Inc. had an annual average earnings growth of 15.0% over the past 10 years.
Silver Run Acquisition Corp. II (SRUN, Financial)
Klarman bought 6,615,552 shares of the company. It traded for an estimated price of $10 per share for the quarter, for a total cost of roughly $67 million.
Silver Run Acquisition Corp II has a market cap of $1.05 billion; its shares were traded around $10.15 Friday.
Spirit Realty Capital Inc. (SRC, Financial)
Klarman bought 9 million shares of the company. It traded for an estimated average price of $8 for the quarter, for a total cost of roughly $66.69 million.
Spirit Realty Capital Inc. has a market cap of $3.79 billion; its shares were traded around $8.26 Friday with a P/E ratio of 58.98 and P/S ratio of 5.89. The trailing 12-month dividend yield of Spirit Realty Capital Inc. stocks is 8.65%. The forward dividend yield of Spirit Realty Capital Inc. stocks is 8.59%. Spirit Realty Capital Inc. had an annual average earnings growth of 6.2% over the past 10 years.
See Seth Klarman (Trades, Portfolio)’s portfolio here.
