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Seth Klarman’s Baupost Group Q2 2025 Moves: Value Discipline Meets a Shifting Rate Cycle
For most of 2025, the Fed has kept its foot on the brake — holding rates high in the face of stubborn inflation, tariff pressures, and wage stickiness. But with growth cooling and markets pricing in a slow, deliberate cutting cycle by year-end, Seth Klarman’s Baupost Group just filed its Q2 2025 13F. The additions and fresh buys blend his trademark value discipline with a readiness for the early innings of a rate-easing environment.
1. Doubling Down on Quality Compounders
Klarman isn’t chasing every momentum trade — he’s scaling up in businesses with structural moats and long-term cash compounding power:
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Alphabet (GOOG): +26.76% to 2.63M shares. Even after a big run, the position signals conviction in Google’s AI pivot, dominant ad ecosystem, and balance sheet fortress.
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WESCO International (WCC): +10.07% to over 2.2M shares. A play on infrastructure, electrification, and industrial distribution scale as supply chains normalize.
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CRH Plc (CRH): +41.98% to 3.82M shares. A global materials leader positioned to benefit from U.S. infrastructure spending and European capital projects.
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Fidelity National Information Services (FIS): +8.50% to 3.79M shares. Core payment processing plus cost-cutting tailwinds post-Worldpay spin-off.
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Dollar General (DG): +26.70% to 2.66M shares. A deep-value defensive for trade-down retail, especially if the consumer weakens before rate cuts bite.
2. Steadying the Consumer Side of the Portfolio
Not every consumer name is a cyclical bet — some are cash-flow engines with brand and franchise power:
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Restaurant Brands International (QSR): +4.19%. Whopper, Popeyes, and Tim Hortons offer recession-resilient traffic and global expansion runway.
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Herbalife (HLF): +2.10%. A contrarian hold/add on a beaten-down name, perhaps for special-situation optionality.
3. New Health and IT Growth Anchors
Klarman isn’t known for chasing tech — so when he enters, it’s deliberate:
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Elevance Health (ELV): +150.41% to 616K shares. Leaning into managed care scale amid healthcare cost volatility. Shares are beaten down to recently announced higher medical costs and negative insurance risk pools among competitors, but this is historically a non-federal funds rate sensitive, stable health insurance company.
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Fiserv (FI): New 895K-share position. Payments and fintech infrastructure with cost leverage potential.
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PagSeguro Digital (PAGS): New 2.5M shares. Brazilian fintech riding digital payments adoption in emerging markets.
4. New Material and Packaging Plays
Sometimes the most boring tickers hide the most reliable cash flow:
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Amcor (AMCR): New 5.5M-share position. Defensive packaging exposure with stable contracts and yield appeal in a falling-rate world.
5. Opportunistic Media & Communications
Klarman added heavily to a Liberty Broadband tracking stock:
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Liberty Broadband (LBRDK): +337.03% to ~796K shares. Potential cable asset monetization and repurchase leverage.
The Macro Read
Baupost’s Q2 2025 portfolio activity sends a clear macro message:
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Defensive Core, Cyclical Optionality: Keep ballast in healthcare, packaging, and discount retail — but own industrials and materials that could pop on an infrastructure upcycle.
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Selective Growth & Tech: Enter only high-quality platforms (Alphabet, Fiserv, PagSeguro) where earnings resilience is paired with secular tailwinds.
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Rate Sensitivity Without Overstretch: Plays like Amcor, Liberty Broadband, and payments infrastructure stand to benefit from lower yields without betting the farm on a rapid cut cycle.
Bottom Line
Klarman is threading the needle between late-cycle caution and early-cycle readiness. If the Fed engineers a soft landing with gradual rate cuts, this mix can capture both defense and upside. If growth stumbles, the value discipline built into these names gives Baupost room to wait for better days.
DISCLAIMER: This analysis of the aforementioned stock security is in no way to be construed, understood, or seen as formal, professional, or any other form of investment advice. We are simply expressing our opinions regarding a publicly traded entity.
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