Hedge Funds

Value investing giant who takes after Buffett just bought big stakes in two Apple suppliers

Key Points
  • Baupost's Seth Klarman bought new stakes in Qualcomm and Qorvo during the first quarter, according to an SEC filing.
  • The firm has $30 billion in assets under management as of year-end 2016, according to a fund spokesperson.
Seth Klarman
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Seth Klarman, the value investing giant who draws comparisons to Warren Buffett, bought large stakes in two Apple suppliers during the first quarter, according to an SEC filing Friday after the market close.

Klarman's hedge fund, Baupost, acquired 5.2 million shares of Qualcomm worth $299 million and 7.2 million shares of Qorvo worth $493 million, according to the March quarter 13F filing.

Four times a year, hedge funds file their long positions with the SEC and the information is released to the public 45 days after each quarter ends.

Qualcomm licenses its wireless technology and manufactures mobile chipsets. And Qorvo makes radio frequency semiconductors, which enable the ability for smartphones to communicate with wireless networks. Both firms count Apple as a customer, according to FactSet.

Apple sued Qualcomm for approximately $1 billion in Jan. 2017 due to a royalty dispute. Investors are also increasingly concerned over Apple's suppliers after the smartphone maker decided to drop Imagination Technologies last month, which resulted in a 62 percent one-day decline in the firm's shares.

But where some investors see trouble, value investors like Klarman see a bargain.

Klarman's fund has reportedly generated annual returns of 16.4 percent and $22.6 billion in net profit for his clients since inception through 2015. Baupost has $30 billion of assets under management as of year-end 2016, according to a firm spokesperson.

The hedge fund manager is revered in value investing circles for his disciplined investing philosophy. Used copies of his "Margin of Safety" investment book still sell for more than $900 online.

Baupost declined to comment on the fund's new investment positions when reached for this story.

Qualcomm shares traded roughly flat, while Qorvo stock rose 6 percent midday Monday.

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