Because of Klarman’s status in the value-investing world, as well as Baupost’s ability to uncover deep value in the various corners of the equity markets, we believe analyzing their 13F filings is a worthwhile exercise. In Q3, Klarman’s big bets were on BP (in which he more than doubled his stake), Microsoft (which started as a new position in the top 5) and PDL BioPharma(which increased from 9.2M shares to 15.6M shares putting it in the top 10). Q4 saw some big changes in the portfolio most notably:
- Shares in Theravance Inc. increasing 42%
- Shares in NovaGold Increasing 49%
- Shares in PDL BioPharma decreasing 49%
- Shares in Idenix Pharma increasing 127%
Baupost’s shares over time shown below:
Reported long positions as % of total reported market value shown below: 
Theravance has consistently been a top 5 position for Klarman and he took advantage of some fourth quarter weakness to increase his stake—which is the only major change of any position in the top 10 (when you consider both classes of NewsCorp collectively). This increased bet appears not to have paid off yet but we can bet Baupost (which is the largest institutional shareholder with almost 17%) will stick it out. (Iridian, Owl Creek, Geode Capital and Hawkeye Capital are also big holders of THRX): 
NovaGold (NG) was a new position last quarter and, again, it looks like Klarman took advantage of some temporary weakness to add shares. This is a popular stock among hedge funds with Paulson & Co. reported as the largest institutional shareholder (8.4% outstanding) followed by Tradewinds Global Investors (a Nuveen subsidiary), Aletheia Research & Management (a CA RIA), BlueRidge, Chilton and finally Baupost (with 2% of shares outstanding): 
PDL BioPharma (PDLI) was a new position in Q4’10 that Klarman quickly ramped up, especially between Q2 and Q3 (when we last reported) that he added an impressive 6.4M shares (69% increase). Well, it appears that Baupost took advantage of strength in this name to harvest some profits bringing Baupost’s institutional ownership significantly down from the 11% as of Q3: 
Idenix Pharma (IDIX) was a new position in Q2 and Klarman has doubled the number of shares held by Baupost both quarters since. Idenix primarily engages in the discovery and development of drugs against viral infections and is already up over 100% this year on takeover speculation over its promising Hep C treatments. With Pharmasset being bought by Gilead for $11BN and Inhibitex being bought by Bristol for $2.5BN speculation that Idenix is next has run the price up. It will be interesting to see if Klarman takes some profits off the table like he seemed to do with PDLI 