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Pershing Square Holdings (PSH)
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Bob Welton
Posted: 04 May 2021 11:13:12(UTC)
#22

Joined: 05/08/2019(UTC)
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Also consider the Fannie Mae and Freddie Mac investments within PSH.
There is a chance of a flip of these this year (although I was wiating for lat last year also at the tail end of the Trump era). It could result in those holdings quarroupling in value.

This is a bit old, but explains part of it.... https://www.ii.co.uk/ana...share-tip-2021-ii514473

Then from the PSH Annual Report - https://assets.pershings...020-Annual-Report-1.pdf

It sugests a decision by June 2021 - "We expect a decision by the Court by June 2021, which if a ruling is issued in shareholders’ favor, would be a game-changing event."

I'm not sure of the Holding levels for Fannie Mae and Freddie Mac, though I recall is quote low, but another interesting angle for PSH.
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4 users thanked Bob Welton for this post.
Big boy on 04/05/2021(UTC), Bulldog Drummond on 04/05/2021(UTC), Tim D on 06/05/2021(UTC), Mr GL on 06/05/2021(UTC)
Old Jock
Posted: 04 May 2021 12:00:11(UTC)
#23

Joined: 04/06/2018(UTC)
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Personally I like this one, for a few reasons:
1. I like Ackman, he generally talks sense and keeps it simple, plus he often cites Buffet as an influence
2. Good long-term track record
3. Contrary to comments above, I don't see any "mom and pop" businesses in the portfolio (?), they all seem to be decent market cap although I agree a retail focus (which might actually be a good thing after the stimulus, and I think Chipotle in particular is smashing it out of the park at the moment)
4. Good entry point from the current discount
5. I like the strategy - a small core of long-only holdings with high conviction, activist positions to unlock value, and the occasional call on a market dislocation/peak
6. I think the UK listing is for tax reasons, although I agree it does look a bit strange, but then again is the location of a listing such a big deal these days? Cazoo is planning to list on the NYSE I believe? Also a few UK healthcare companies seem to prefer listing in the US.
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3 users thanked Old Jock for this post.
Raj K on 04/05/2021(UTC), D92CB459 on 04/05/2021(UTC), Mr GL on 06/05/2021(UTC)
Raj K
Posted: 04 May 2021 12:12:29(UTC)
#24

Joined: 22/04/2016(UTC)
Posts: 2,818
The only thing i was concerned about was the debt that PSH has taken on which is about 17.7% of total assets. AVI Global Trust, who are a holder, seemed to have a problem with this a little while back. Does anyone here see a problem with this?
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Old Jock
Posted: 04 May 2021 12:38:33(UTC)
#25

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Interesting, thanks Raj. Debt will gear up the return which is maybe not great if markets are frothy. Although arguably it's a good time to borrow with rates at rock-bottom. 17.7% does feel a bit high though, so overall a negative. But as I say I'm backing Ackman, so if that's his call then it's not enough of a reason to put me off a decent size holding.
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Strangways
Posted: 04 May 2021 19:45:39(UTC)
#26

Joined: 23/12/2020(UTC)
Posts: 565
To what extent are PSH’s fortunes dependent on the SPAC PSTH? This could be a positive or a negative, depending on whether you would like some SPAC exposure. The manager is the sort of person who might carry it off. Bear in mind there are also self-declared “Tontards” active on Reddit talking up the SPAC!
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Big boy
Posted: 05 May 2021 16:19:49(UTC)
#27

Joined: 20/01/2015(UTC)
Posts: 6,676
Strangways;168264 wrote:
To what extent are PSH’s fortunes dependent on the SPAC PSTH? This could be a positive or a negative, depending on whether you would like some SPAC exposure. The manager is the sort of person who might carry it off. Bear in mind there are also self-declared “Tontards” active on Reddit talking up the SPAC!


Positive or negative......no one can tell us the answer about something in the future.....if they say they can don’t believe it. We have to value the shares and then compare with the current price. It’s then buy/sell or hold. I believe they are a buy/hold at this price. Buying assets at 75p in the pound makes a lot of sense.
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Mr TIPS
Posted: 06 May 2021 09:26:01(UTC)
#28

Joined: 12/12/2020(UTC)
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Interview with the great man himself....
https://www.youtube.com/watch?v=iJeZ_w355EU
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Mr GL on 06/05/2021(UTC)
Big boy
Posted: 06 May 2021 10:58:54(UTC)
#29

Joined: 20/01/2015(UTC)
Posts: 6,676
Mr TIPS;168516 wrote:
Interview with the great man himself....
https://www.youtube.com/watch?v=iJeZ_w355EU


Thank you Mr T.....does this interview tempt anyone into the shares on 25% discount.

It’s still one of my larger holdings which is based on to-days valuation not what they have done in the past.
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TheWurzel
Posted: 06 May 2021 15:18:26(UTC)
#30

Joined: 11/02/2018(UTC)
Posts: 192
Am I correct in thinking that the discount is even more attractive given its holding cash of 18.6%? The 12m average discount of c.28.23% is slightly greater than the current discount (and June last year was over 30% - anybody any feel for cash levels over that period? Or is the cash SPAC related?

The largest Chipotle holding is more than 50% up on its pre-pandemic price, Hilton the second largest is 10% higher than pre-pandemic, the third (Lowe's) has nearly doubled from the same period and the fourth is over 10% higher than pre-pandemic.

I find it strange that they have all done so well - assuming that full re-opening is unlikely to be significantly more profitable than pre-pandemic. Those four positions total over 50% of the holdings, the fees are high and the discount persistent.

But most likely I just don't understand it properly.
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Bulldog Drummond
Posted: 06 May 2021 16:35:56(UTC)
#31

Joined: 03/10/2017(UTC)
Posts: 6,253
TheWurzel;168593 wrote:
Am I correct in thinking that the discount is even more attractive given its holding cash of 18.6%? The 12m average discount of c.28.23% is slightly greater than the current discount (and June last year was over 30% - anybody any feel for cash levels over that period? Or is the cash SPAC related?

The largest Chipotle holding is more than 50% up on its pre-pandemic price, Hilton the second largest is 10% higher than pre-pandemic, the third (Lowe's) has nearly doubled from the same period and the fourth is over 10% higher than pre-pandemic.

I find it strange that they have all done so well - assuming that full re-opening is unlikely to be significantly more profitable than pre-pandemic. Those four positions total over 50% of the holdings, the fees are high and the discount persistent.

But most likely I just don't understand it properly.


I take the argument that returns are more important than fees, and that big discounts are nice, but I just find it difficult to swallow fees in the region of 6% (or even 4% for that matter).

We all know who made money out of the 2+20 funds, and on the whole it wasn't the investors.
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