Theravance Biopharma is a top pick of investment guru Seth Klarman

Theravance Biopharma is a top pick of investment guru Seth Klarman

1600
0
SHARE

Strong in pharmaceutical niches

Botox, the well-known remedy in beauty surgery, as well as an active substance for the treatment of the cornea, are two examples of niches that the US pharmacist Allergan successfully occupies. The profit goes back again. By 2019, analysts expect annual growth of between 12 and 18 percent.

Seth Klarman’s Favorite Stock

Seth Klarman, like his idol Warren Buffett, disputes with company bosses out of the way. Perhaps this is why the renowned value investor is one of the most successful portfolio managers of past decades with an annual increase of almost 20 percent of his hedge fund. The New York Times writes that he is probably the most successful and influential investor, but has probably never heard of it.

Klarmans founded hedge fund Baupost Group for institutional investors and wealthy families managed around 31 billion dollars in 1983 and is considered extremely private. Klarman’s hard-to-find book “Margin of Safety” is a classic for investment professionals and is traded on Ebay with at around 1,500 dollars. Top priority for the 59-year-old is a thorough risk analysis and a loss limit defined from the start.

In the annual letter to his investors, Klarman warned in February before the Trump euphoria that tax cuts could massively boost public debt and trumps plans to stimulate the economy will end in higher inflation. “This would probably shock the investors,” wrote Klarman. The billionaire as usual said nothing about a possible strategy swing. But the investors trust him blindly. In his 34 years as a hedge fund manager, Klarman drove a loss only in three years. He recently reduced his stake in the US energy group Cheniere Energy, one of Klarman’s biggest investments.

The building founder holds a great deal on Theravance Biopharma. He recently significantly increased his stake in the US biotech company. Over the past twelve months, the stock has shown an impressive rally with a 70% increase in share price. With the antibiotic Vibativ Theravance achieves first sales. Vibrant is used in patients suffering from pulmonary infections caused by resistant germs. Other medicines, such as the treatment of smokers’ lungs, are being tested. However, Klarman’s bet on Theravance is highly risky: analysts expect the company to write low-carbon figures at least until 2020.

SHARE
Previous articleLufthansa overtakes Turkish – the best airline in Europe
Next articleAmazon picks a new sector at gunpoint – the fashion industry
I cover technology, utilities and biotechnology for Markets Morning, and I help out occasionally with other industry sectors. I've written about investment and personal finance topics for more than 20 years from a lowly copywriter to editor-in-chief, so I've done a little bit of everything. For what it's worth, I have a BA from Duke University and an MBA from Rollins College. I'm married with one daughter, and that's worth more than everything else put together.

NO COMMENTS

LEAVE A REPLY