Bill Ackman Stock Portfolio: 7 Top Stock Picks
In this article, we discuss the 7 top stock picks of billionaire Bill Ackman. If you want to read about some stocks in the Ackman portfolio, go directly to Bill Ackman Stock Portfolio: 3 Top Stock Picks.
Bill Ackman, the billionaire titan of Pershing Square, is one of the most renowned names on Wall Street. Ackman, whose net worth is around $4 billion, began as a small-time investor in 2004 and has grown his hedge fund into one of the most formidable in the finance world. At the end of the third quarter of 2023, his hedge fund managed an equity portfolio worth more than $10.4 billion. Between June and September 2023, his fund made additional purchases in three stocks and reduced holdings in one stock. It did not sell any position off completely.
In August last year, Ackman had announced he would be transferring some executive duties at his fund to Ryan Israel, one of the partners at Pershing Square. The statement had come at a time the markets were in turmoil, with recession fears clouding the economy and top stocks like The Walt Disney Company (NYSE:DIS), Walmart Inc. (NYSE:WMT), and Marriott International, Inc. (NASDAQ:MAR) taking a beating. However, Ackman assured investors he was still involved in the money management process at the fund.
Since then, the value of the equity portfolio at Pershing has jumped more than $3 billion, a testament to the investing genius of the New York-born finance guru. One of the most famous bets he has made since August has been against 30-year Treasury bonds in the United States. Per a report in the Financial Times, Ackman has pocketed nearly $200 million from this short, exiting the position earlier this month. Investors eager to learn from the investing strategy of the billionaire can check out his latest stock activity, discussed below.
Our Methodology
The companies listed below were picked from the 13F portfolio of Pershing Square at the end of the third quarter of 2023. In order to provide readers with some context for their investment choices, the analyst ratings for the stocks are also discussed. Data from around 900 elite hedge funds tracked by Insider Monkey in the second quarter of 2023 was used to identify the number of hedge funds that hold stakes in each firm.
Bill Ackman of Pershing Square
Top Stock Picks of Billionaire Bill Ackman
7. Canadian Pacific Kansas City Limited (NYSE:CP)
Number of Hedge Fund Holders: 52
Canadian Pacific Kansas City Limited (NYSE:CP) owns and operates a transcontinental freight railway. Latest data shows that Pershing Square owned 15 million shares of Canadian Pacific Kansas City Limited (NYSE:CP) at the end of the third quarter of 2023 worth $1.1 billion, representing 10.7% of the portfolio.
On September 12, investment advisory Argus maintained a Buy rating on Canadian Pacific Kansas City Limited (NYSE:CP) stock and lowered the price target to $84 from $92, noting that there was macro positivity on the company as the rail industry displayed secular growth trends.
At the end of the second quarter of 2023, 52 hedge funds in the database of Insider Monkey held stakes worth $8.1 billion in Canadian Pacific Kansas City Limited (NYSE:CP), compared to 48 in the preceding quarter worth $7.7 billion.
Just like The Walt Disney Company (NYSE:DIS), Walmart Inc. (NYSE:WMT), and Marriott International, Inc. (NASDAQ:MAR), Canadian Pacific Kansas City Limited (NYSE:CP) is one of the top stocks in the portfolio of elite investors.
In its first half 2023 investor letter, Pershing Square Holdings, an asset management firm, highlighted a few stocks and Canadian Pacific Kansas City Limited (NYSE:CP) was one of them. Here is what the fund said:
Canadian Pacific Kansas City Limited (NYSE:CP) is a high-quality business with significant earnings growth potential that operates in an oligopolistic industry with considerable barriers to entry and significant pricing power due to its high quality competitive transportation offering. After receiving regulatory approval from the Surface Transportation Board on March 15, Canadian Pacific closed the acquisition of Kansas City Southern on April 14th and renamed the combined company Canadian Pacific Kansas City.
CPKC is a high-quality business with significant earnings growth potential that operates in an oligopolistic industry with considerable barriers to entry and significant pricing power due to its high quality competitive transportation offering. After receiving regulatory approval from the Surface Transportation Board on March 15, Canadian Pacific closed the acquisition of Kansas City Southern on April 14th and renamed the combined company Canadian Pacific Kansas City. …” (Click here to read the full text)
6. Alphabet Inc. (NASDAQ:GOOG)
Number of Hedge Fund Holders: 152
We have to note that Ackman also has a nearly $600 million position in Alphabet Inc Class A (GOOGL) shares and if we combine this with his $1.2 billion position in Class C shares, this would become Ackman's biggest position in a company. Alphabet Inc. (NASDAQ:GOOG) provides various products and platforms such as Google Services, Google Cloud etc. Latest data shows that Pershing Square owned 9.3 million shares of Alphabet Inc. (NASDAQ:GOOG) at the end of the third quarter of 2023 worth $1.2 billion, representing 11.78% of the portfolio.
On November 16, investment advisory Wells Fargo maintained an Equal Weight rating on Alphabet Inc. (NASDAQ:GOOG) stock and raised the price target to $129 from $126.
Among the hedge funds being tracked by Insider Monkey, Texas-based investment firm Fisher Asset Management is a leading shareholder in Alphabet Inc. (NASDAQ:GOOG) with 43 million shares worth more than $5.7 billion.
In its Q3 2023 investor letter, Weitz Investment Management, an asset management firm, highlighted a few stocks and Alphabet Inc. (NASDAQ:GOOG) was one of them. Here is what the fund said:
“As for other quarterly contributors, Alphabet Inc. (NASDAQ:GOOG) and Meta Platforms, Inc., (META) added to their exceptional year-to-date returns. Meta Platforms and Alphabet were the true year-to-date standouts. After steep declines in 2022, both stocks rebounded sharply due to a combination of solid fundamentals, disciplined operational execution, and improved sentiment. Despite outsized gains and attention, we think both Alphabet and Meta remain undervalued.”
5. Howard Hughes Holdings Inc. (NYSE:HHH)
Number of Hedge Fund Holders: 26
Howard Hughes Holdings Inc. (NYSE:HHH) owns, manages, and develops commercial, residential, and hospitality operating properties. Securities filings reveal that Pershing Square owned 16.8 million shares of Howard Hughes Holdings Inc. (NYSE:HHH) at the end of the third quarter of 2023 worth $1.2 billion, representing 11.87% of the portfolio.
In early September, BWS Financial analyst Hamed Khorsand maintained a Buy rating on Howard Hughes Holdings Inc. (NYSE:HHH) stock and lowered the price target to $110 from $150, noting the stock was likely to trade at a discount to NAV until free cash flow stabilized.
At the end of the second quarter of 2023, 26 hedge funds in the database of Insider Monkey held stakes worth $1.4 billion in Howard Hughes Holdings Inc. (NYSE:HHH), compared to 24 in the previous quarter worth $1.3 billion.
In its first half 2023 investor letter, Pershing Square Holdings, an asset management firm, highlighted a few stocks and Howard Hughes Holdings Inc. (NYSE:HHH) was one of them. Here is what the fund said:
“Howard Hughes Holdings Inc. (NYSE:HHH)’s high-quality collection of well-located master planned communities (“MPC”) delivered resilient performance in the first half of 2023 led by a strong recovery in the housing market and robust leasing momentum in the company’s income producing operating assets.
Mortgage interest rates have stabilized this year after rapidly rising in 2022. The supply of home resale inventory remains constrained as homeowners are reluctant to sell their existing homes and incur more expensive mortgages. As a result, there has been a resurgence in demand for newly built homes. Amidst that backdrop, the relative affordability of HHH’s MPCs, which are located in low cost-of-living and low-tax states like Texas and Nevada, remains highly appealing to prospective homebuyers. New home sales in HHH’s MPCs increased 11% year-over-year in the first half of 2023, reflecting strong demand for future land sales and causing the company to raise its guidance for full-year 2023 MPC land sale profits by 20%.
In HHH’s income-producing operating assets, net operating income (“NOI”) grew 6% on a same-store basis during the first half of the year driven by improving leasing velocity and strong rental rate growth. The company’s office portfolio is benefiting from a “flight to quality” as companies and their employees are drawn to the desirability of HHH’s walkable and amenity-rich MPCs. Likewise, in the company’s condominium development at Ward Village, Hawaii, HHH continues to experience durable sales momentum with its latest condo tower already 83% pre-sold within nine months of its launch. In the most recent quarter, the company contracted to sell 43 units, representing an impressive 27% of available unit inventory. At its Seaport development in New York City, the company is focused on driving operational improvements at the recently opened Tin Building food hall, which continues to generate operating losses in its first full year of operations.…” (Click here to read the full text)
4. Lowe's Companies, Inc. (NYSE:LOW)
Number of Hedge Fund Holders: 64
Lowe's Companies, Inc. (NYSE:LOW) operates as a home improvement retailer in the United States and internationally. According to regulatory filings, Pershing Square owned 7 million shares in Lowe's Companies, Inc. (NYSE:LOW) at the end of September 2023 worth $1.4 billion, representing 13.99% of the portfolio.
On October 18, Piper Sandler analyst Peter Keith maintained an Overweight rating on Lowe's Companies, Inc. (NYSE:LOW) stock and lowered the price target to $240 from $262, noting stability in total home equity extractions quarter-over-quarter.
At the end of the second quarter of 2023, 64 hedge funds in the database of Insider Monkey held stakes worth $3.7 billion in Lowe's Companies, Inc. (NYSE:LOW), compared to 67 in the previous quarter worth $5 billion.
In addition to The Walt Disney Company (NYSE:DIS), Walmart Inc. (NYSE:WMT), and Marriott International, Inc. (NASDAQ:MAR), Lowe's Companies, Inc. (NYSE:LOW) is one of the top stocks in the portfolio of elite investors.
In its Q3 2023 investor letter, Madison Investments, an asset management firm, highlighted a few stocks and Lowe's Companies, Inc. (NYSE:LOW) was one of them. Here is what the fund said:
“The bottom five individual contributors were Dollar Tree, Fiserv, Analog Devices, Lowe’s Companies, Inc. (NYSE:LOW), and Alcon. Both Analog Devices and Lowe’s Companies saw end-market demand moderate (in semiconductors and home improvement products, respectively) relative to the strong levels over the last couple of years. Despite these near-term trends, we remain very confident in the long-term trends within both markets.”
Click to continue reading and see Top 3 Stocks in Bill Ackman Portfolio.
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Disclosure. None. Bill Ackman Stock Portfolio: 7 Top Stock Picks is originally published on Insider Monkey.