2023-07-21 11:31:00
In my column “Kissig’s portfolio check” I regularly take for the “Share Magazine” from Traderfox scrutinizes the portfolios of the best investors of our time. I’m looking for the first time at my 229th portfolio check Bill Ackman over the shoulder of an activist investor who prefers to buy common stock of publicly traded companies and then publicly pressures management to make changes so the market can see the companies’ true worth. For many years, Ackmann was considered the rising superstar in the industry, but then he made a big mistake. He bought out in a big way at the Canadian Valeant Pharmaceuticals which he dubbed ‘The Berkshire Hathaway of Pharma’ – but the company stumbled into fraud, billing errors and pyramid scheme-type business practices. In the end, he gave up and sold his Valeant shares at a huge loss. The damage to his reputation was almost more serious. But Ackman managed to resurrect and get back on the road to success. And he added new strategies to his investor toolbox: Today, Ackman also buys into great companies that have solid cash flows and an enormous economic moat in order to profit from their value creation. There is his portfolio extremely focused on only the most promising quality company, on which he then bets large sums. And if he’s wrong, he throws these shares out of the portfolio quickly and consistently.
At the end of the first quarter of 2023, Ackmann had 7 stocks in the portfolio, including one new acquisition. Its portfolio value was $10.2 billion, up 16% from the previous quarter ($8.78 billion) and its turnover rate was still 11%. With a share of 65.5% (Q4/22: 73%), cyclical consumer stocks dominate in Ackmans Depot. They are followed by real estate stocks at 12.5% (13.8%), followed by industrial stocks at 11.5% (12.9%) and communication stocks at 11.5% (0%). So communications stocks are new to the portfolio and the sector is solely represented by Alphabet, its new acquisition.
The largest position in Ackman’s depot remains building materials retailer Lowe’s, with a stake of just under 20%. Chipotle Mexican Grill is close behind with a portfolio weighting of a good 17%. In the same sector is Restaurant Brands International, which operates the franchises of Burger King, Tim Hortons, Popeyes, and Firehouse Subs, and ranks third in the depot with a nearly 16% share.
Canadian Pacific Kansas City Ltd is the second-smallest holding in Ackman’s portfolio at 11.5% weighting, ahead of the newly initiated Alphabet position at seventh and last. The seventh largest railway company in North America was formed by the merger of Canadian Pacific and Kansas City Southern and is now the only one with a route network that stretches from Canada to the USA and Mexico. And with it enormous potential, as Ackman thinks…
Disclaimer: Have Alphabet, Berkshire Hathaway on my watchlist and/or depot/wiki.
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