Bill Ackman: latest SPAC news and how to make his portfolio | Summary and Q&A

TL;DR

Bill Ackman, the renowned investor and founder of Pershing Square Holdings, discusses the company's success as a FTSE 100 company and the potential future catalysts, including a transaction for their special purpose acquisition company (SPAC). He also reveals the criteria for selecting stocks for their portfolio and addresses the persistent discount to net asset value (NAV) of Pershing Square stock.

Key Insights

• ❓ Pershing Square Holdings becoming a FTSE 100 company is a significant achievement and highlights the company's success in the market.
• 📢 The announcement of a transaction for their SPAC is expected to be the next major catalyst for Pershing Square Holdings and is likely to create value for shareholders.
• 👨‍💼 Pershing Square's portfolio consists of durable businesses with predictable growth and defensible characteristics, chosen based on their ability to generate attractive margins and take market share.
• 👨‍💼 The discount to NAV for Pershing Square stock is considered temporary, and the company believes that with time and consistent performance, investors will recognize the value and quality of their business.

Transcript

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Questions & Answers

Q: What is the next significant catalyst that Pershing Square Holdings is waiting for?

The next significant catalyst for Pershing Square Holdings is the announcement of a transaction for their special purpose acquisition company (SPAC). This transaction is expected to be a large investment and will create value for shareholders. The company has confidence in their ability to deliver on this front.

Q: What is the strategy for selecting stocks in Pershing Square's portfolio?

Stocks must meet certain criteria to make it into Pershing Square's portfolio. They are looking for durable businesses with predictable growth and defensible characteristics. They want businesses that can generate attractive margins and continue to take share over a long period of time. Additionally, the company considers the price at which they can buy the stock to ensure an attractive return over time.

Q: Why is there still a discount to net asset value (NAV) for Pershing Square stock?

According to Bill Ackman, the discount to NAV for Pershing Square stock is a matter of time. The company went through a challenging period, but with their consistent performance and impressive returns on capital, he believes that over time, people will recognize the quality of their business, leading to a reduction in the discount.

Q: What was the reason behind selling Starbucks and replacing it with a new investment?

Pershing Square sold Starbucks and replaced it with a new investment because they believed that the new investment would offer a more attractive long-term return. The company is always looking for great businesses to own and is willing to replace existing positions if they can find better opportunities.

Summary & Key Takeaways

• Pershing Square Holdings has become a FTSE 100 company, and Bill Ackman believes that the next significant catalyst for the company is the announcement of a transaction for their SPAC, which he believes will create value for shareholders.

• The company's portfolio consists of 10 stocks, and in 2021, they sold Starbucks and replaced it with a new investment that will likely provide a more attractive long-term return. The company is constantly looking for great businesses to own and is willing to replace existing positions.

• In order for a stock to make it into the Pershing Square portfolio, it must be a durable business with predictable growth and defensible characteristics. The company aims to buy stocks at a price that offers an attractive return over time.