Seth Klarman’s Baupost Group has disclosed its equity portfolio for the reporting period of March 31 in a new 13F filing with the U.S. Securities and Exchange Commission. Baupost Group is one of the world’s largest hedge funds, with nearly $30 billion in assets under management. In 1982, Baupost was launched by professors at Harvard Business School, who then hired their former student Mr. Klarman to manage the fund. Klarman makes large and long-term investments in assets believed to be undervalued and his fund has posted solid returns over the last year, amounting to 30%. Baupost held stakes in 28 positions at the end of the first quarter, with the value of the portfolio standing at $5.95 billion. The five largest holdings of the fund are represented by Cheniere Energy Inc. (NYSEMKT:LNG), ViaSat Inc. (NASDAQ:VSAT), eBay Inc (NASDAQ:EBAY), Micron Technology Inc. (NASDAQ:MU), and Pioneer Natural Resources (NYSE:PXD).
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Baupost’s top holding remains Cheniere Energy Inc. (NYSEMKT:LNG), in which the fund held 13.81 million shares at the end of the first quarter. The stake, which remained unchanged over the quarter, is valued at $1.07 billion. The company’s stock has performed well since May 2014, rising by 33.21%.Cheniere Energy Inc. (NYSEMKT:LNG) is engaged in LNG-related businesses, and it owns and operates the Sabine Pass LNG terminal and Creole Trail Pipeline in Louisiana. The company is building two terminals, which are set to provide it with major export opportunities. Cheniere Energy Inc. (NYSEMKT:LNG) saw a net loss of $267.7 million, or $1.18 per share, in the first quarter, compared to a net loss of $97.8 million, or $0.44 per share, in the same year-ago period. One of the largest stockholders of Cheniere Energy Inc. (NYSEMKT:LNG) is Andreas Halvorsen‘s Viking Global, owning 15.45 million shares as of the end of the first quarter.
The second favorite stock pick of Baupost is ViaSat Inc. (NASDAQ:VSAT), in which the fund held 11.53 million shares worth $687.49 million, as of the end of the first quarter. ViaSat Inc. (NASDAQ:VSAT) is engaged in making satellite and wireless networking applications and has a market cap of $2.95 billion, with the company’s shares dropping by 5.43% during the first three months of 2015. The company is banking on ViaSat-2, its next generation of high-capacity broadband satellite. The satellite is scheduled to be launched in the summer of 2016 with the help of Elon Musk’s SpaceX. It is designed to provide another leap ahead in broadband service quality for residential, mobile, and enterprise satellite services. Another large investor of the company is FPR Partners, led by Bob Peck and Andy Raab, which held 4.71 million ViaSat Inc. (NASDAQ:VSAT) shares as of the end of the first quarter.
Third spot in Klarman’s equity portfolio is held by eBay Inc (NASDAQ:EBAY), in which his fund disclosed ownership of 9.32 million shares, worth $537.29 million as of March 31. eBay Inc (NASDAQ:EBAY)’s shares gained 2.78% during the first three months as the company topped consensus estimates for its first quarter earnings, posting adjusted earnings per share of $0.77 versus estimates of $0.71. Revenue for the first quarter was $4.5 billion, just above consensus estimates of $4.4 billion. eBay Inc (NASDAQ:EBAY) is in the process of spinning off PayPal into a separate publicly-traded company. The separation is expected to be completed in the third quarter of 2015. Legendary investor Carl Icahn is also a big fan of eBay Inc. (NASDAQ:EBAY), with his fund Icahn Capital holding 46.27 million shares of the e-commerce company as of the end of the first quarter.
In Micron Technology Inc. (NASDAQ:MU), Baupost held 19.71 million shares, with a reported value of $534.63 million, the holding remaining unchanged over the quarter after Klarman slashed it by 61% during the fourth quarter. That proved wise short-term, as Micron’s stock lost 22.51% during the first quarter and 24.41% year-to-date. For the fiscal second quarter of 2015 ending March 5, Micron Technology Inc. (NASDAQ:MU) posted revenues of $4.17 billion, up 9% compared to the same period a year ago. Net income dropped to $941 million, or $0.81 per diluted share, from $1.14 billion, or $0.97 per diluted share quarter over quarter. Recently, analysts at Nomura reiterated their “Neutral” rating on Micron Technology Inc. (NASDAQ:MU), in addition to reducing their price target on the company to $25 from $28. Other large investors of the company include David Einhorn’s Greenlight Capital and Andreas Halvorsen’s Viking Global.
The fifth top holding of Klarman is represented by Pioneer Natural Resources (NYSE:PXD), a new position in which Baupost bought 3.17 million shares during the first quarter, worth $517.83 million as of March 31. Pioneer Natural Resources (NYSE:PXD) is a $23.3 billion company engaged in oil and gas exploration and production. David Einhorn of Greenlight Capital recently slammed Pioneer Natural Resources (NYSE:PXD) at the 20th annual Sohn Investment Conference. Einhorn took aim at fracking companies during his presentation, focusing on Pioneer Natural Resources (NYSE:PXD). He called the company a “motherfracker” and derided its wasteful spending and cash-burning operations, which includes a loss of $12 for every barrel of oil equivalent that it produces. According to Einhorn, such companies have a “nearly infinite supply of negative return opportunities.” Shares of Pioneer Natural Resources (NYSE:PXD) gained 9.85% during the first quarter but gave back most of those gains following Einhorn’s presentation in early May. Pioneer Natural Resources swung to a loss of $78 million, or $0.52 per share during the first quarter, versus net income of $123 million, or $0.85 per share in the same quarter last year. Other investors that disagree with Einhorn and see value in Pioneer Natural Resources (NYSE:PXD) include SPO Advisory Corp led by John H. Scully, which held 7.35 million shares at the end of the first quarter.
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