Baupost’s Seth Klarman took a sizable stake in discount store Dollar General last quarter, while exiting Michael Kors-owner Capri before its megadeal to merge with Tapestry was blocked by regulators. The notable hedge fund investor built a $195 million stake in Dollar General, making it his eighth biggest holding at the end of September, according to a new regulatory filing. The retailer, which caters to more rural areas, has been struggling this year as it slashed its sales and profit guidance , blaming “financially constrained” customers. The stock took another beating after Donald Trump’s reelection raised concerns that his proposed universal tariffs could lead to soaring import prices. Shares of Dollar General have lost 4% this month, pushing its 2024 losses to more than 43%. Elsewhere, Klarman dumped his $35 million investment in Capri last quarter. His sale came ahead of news Thursday that Tapestry and Capri have mutually agreed to call off their merger after the Federal Trade Commission successfully sued to block the megadeal between two U.S.-based luxury houses. It appeared that Klarman was able to avoid a big sell-off in Capri. The stock has lost more than half of its value after rallying 28.3% in the second quarter when the investor first took the stake. Klarman, a follower of Benjamin Graham’s investing style, has drawn comparisons to Warren Buffett for his patient, disciplined approach, leading some to dub him “The Oracle of Boston.” The Harvard and Cornell grad published his now out-of-print investment guide, “Margin of Safety,” in 1991. The book now sells for thousands of dollars online. Among Baupost’s top 10 holdings, the hedge fund increased its positions in Google parent Alphabet , electrical distribution and services company Wesco International and building materials producer Eagle Materials. Also during the third quarter, Baupost added a small stake in Tamboran Resources , an Australian oil and natural gas firm that became public in June. The bet could be a value play as the stock has fallen 21% since its debut.
Baupost’s Seth Klarman takes new stake in Dollar General, exits Capri
