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Seth Klarman’s Baupost Group hedge fund has returned an average of 20% per year over its first 30 years, even as value stocks have declined in popularity. Recently, Klarman added 652,000 shares of Alphabet (NASDAQ: GOOG, GOOGL) in the first quarter, increasing his stake by 46%. This investment is notable as Alphabet trades below the average S&P 500 valuation despite its growth potential.
Alphabet’s Google Cloud platform reported a 28% year-over-year revenue growth in the first quarter, while its operating margin rose from 9.4% to 17.8%. Additionally, Waymo, Alphabet’s self-driving car division, now completes 250,000 paid trips weekly, indicating strong market demand. While facing regulatory challenges and competition from AI, Alphabet’s resilience positions it as a strong investment choice in the current market.
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