Bloomberg News

Klarman’s Baupost Cuts Its Holdings in Hewlett-Packard

November 13, 2012

Baupost Group LLC, the Boston-based hedge fund run by Seth Klarman, sold almost half of its shares in Hewlett-Packard Co. (HPQ:US) in the third quarter as the technology firm stumbled.

Baupost sold 12.47 million of Palo Alto-based Hewlett- Packard, cutting its holdings to 14.38 million shares, according to a filing today with the U.S. Securities and Exchange Commission. Baupost also sold 5.6 million shares of Microsoft Corp. (MSFT:US), bringing its stake in the software company to 1.4 million shares, the firm said.

Hewlett-Packard cut its forecast for full-year profit in August, underscoring the challenge facing Chief Executive Officer Meg Whitman. In October, Whitman projected 2013 profit that missed analysts’ estimates and told analysts a turnaround at the computer maker wouldn’t happen any time soon. Hewlett- Packard lost 49 percent this year, making it the fourth-worst performing stock in the Standard & Poor’s 500 Index, according to data compiled by Bloomberg.

Baupost bought Hewlett-Packard in the third quarter of 2011, according to data compiled by Bloomberg.

Hewlett-Packard and Redmond, Washington-based Microsoft have lost ground as competition from tablets have squeezed sales. Microsoft, the largest software maker, reported fiscal first-quarter revenue and profit in October that missed estimates on declining sales of Windows. Its shares have gained 4.4 percent this year.

Klarman is a bargain hunter who wrote the preface to the sixth edition of “Security Analysis,” a 1934 book by Benjamin Graham and David Dodd that is considered the bible of value investing.

Money managers who oversee more than $100 million in equities must file a Form 13F within 45 days of each quarter’s end to list their U.S.-traded stocks, options and convertible bonds. The filings don’t show non-U.S. securities or how much cash the firms hold.

To contact the reporter on this story: Charles Stein in Boston at cstein4@bloomberg.net

To contact the editor responsible for this story: Christian Baumgaertel at cbaumgaertel@bloomberg.net


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Companies Mentioned

  • HPQ
    (Hewlett-Packard Co)
    • $40.54 USD
    • 0.18
    • 0.44%
  • MSFT
    (Microsoft Corp)
    • $48.14 USD
    • -0.31
    • -0.64%
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