Breaking News
0

Exclusive: Ackman's hedge funds gain after years of losses, Chipotle helps

Stock MarketsJun 14, 2018 06:30PM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items
 
© Reuters. William 'Bill' Ackman, CEO and Portfolio Manager of Pershing Square Capital Management, speaks during the Sohn Investment Conference in New York City

By Svea Herbst-Bayliss

BOSTON (Reuters) - William Ackman's private hedge fund has gained more than 9 percent this year while his publicly traded fund is up double digits, marking a dramatic reversal for the billionaire investor after three years of losses.

Pershing Square (NYSE:SQ) International climbed 9.3 percent from January through June 12, an investor in the fund said on Thursday. According to data from HSBC, the firm now ranks as one of the top 20 performing hedge funds for 2018.

Pershing Square Holdings, the largest fund managed by Ackman's New York-based Pershing Square Capital Management, has climbed 11.4 percent since January, Pershing Square told clients late on Wednesday.

Last month Ackman told clients that performance was improving as all of his portfolios were finally in the black for the year.

Those gains have now grown and could signal a comeback for 52-year old manager after three years of back-to-back losses that helped shrink Pershing Square's assets to roughly $8 billion, about half of what Ackman managed at the firm's peak in 2015.

Despite years of poor performance, Ackman remains one of the industry's most closely watched managers at a time active management has come under fire for high costs, and as other prominent fund managers post sluggish returns.

Ackman, who made three new investments this year, is now beating the average hedge fund's roughly flat return for the year, according to data from Hedge Fund Research.

Returns have been fueled by gains at Chipotle Mexican Grill (NYSE:CMG) and Automatic Data Processing.

Burrito chain Chipotle, in which Pershing Square is the biggest investor with a 10 percent stake, saw its share price tumble to $251 after a string of food safety lapses.

Ackman bought the stake in 2016 for an average cost of $405 and joked last year that his investment team would be eating Chipotle until the stock price recovered. Earlier this year he helped install Brian Niccol as chief executive and Chipotle closed at $460.44 on Thursday, gaining 58 percent since January.

Automatic Data Processing, where Ackman lost a bitter proxy contest in late 2017, has climbed 19.75 percent since January to close trading on Thursday at $139.82, far above Ackman's average cost of $105 a share.

The human resources software company held an investor day earlier this week and said its chief financial officer, Jan Siegmund, will be leaving.

Ackman, who told investors earlier this year that he would be lowering his profile as he seeks to turn around the firm's performance, declined to comment.

Last year Ackman had said he was ready for a comeback. "I'm incredibly focused. I've got something to prove," he said.

Exclusive: Ackman's hedge funds gain after years of losses, Chipotle helps
 

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind: 

  • Enrich the conversation
  • Stay focused and on track. Only post material that’s relevant to the topic being discussed.
  • Be respectful. Even negative opinions can be framed positively and diplomatically.
  •  Use standard writing style. Include punctuation and upper and lower cases.
  • NOTE: Spam and/or promotional messages and links within a comment will be removed
  • Avoid profanity, slander or personal attacks directed at an author or another user.
  • Don’t Monopolize the Conversation. We appreciate passion and conviction, but we also believe strongly in giving everyone a chance to air their thoughts. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.
Continue with Google
or
Sign up with Email