Pershing Square Holdings (PSH), the £6.6bn US equities fund run by Bill Ackman, this week reported a 3.5% investment return for the third quarter to 30 September, beating the S&P 500 which rose 2.3%. However, growth in net asset value of 40% and 62% over three and five years is hampered by the wide 37% share price discount which has left shareholders with 35% and 36% over those periods. That compares to 61% and 68% from the US index.
Matthew Read, senior analyst at QuotedData, said: “The improvement in Pershing Square’s performance in the third-quarter recovery is welcome, but its NAV has fallen almost 10% during the first nine months of this year, versus a 13% gain for the S&P 500, highlighting the risks of its concentrated approach. However, echoing the thoughts of other commentators, Ackman sees considerable opportunity in a market increasingly dominated by enthusiasm for AI infrastructure, arguing that investors are overlooking high-quality businesses delivering strong earnings growth. The managers estimate that portfolio earnings could grow by 20% annually over the next three to five years, against 13% for the S&P 500, despite similar valuations. If they are right, the potential upside could be substantial, but we think shareholders will be hoping this translates into improved performance sooner rather than later. In the meantime, Ackman’s confidence in Microsoft, Meta and Amazon appears undimmed, with the three now accounting for more than a third of NAV. This gives PSH significant exposure to the AI trade but leaves it vulnerable if there is a significant setback.”
CC Japan Income & Growth (CCJI) is changing its name to Chikara Income & Growth to reflect the name of its investment manager which changed from Coupland Cardiff Asset Management to Chikara three years ago. There are no changes to investment objectives and policy and the share price ticker remains the same.
Brown Advisory US Smaller Companies (BASC) and JPMorgan US Smaller Companies (JUSC) have published circulars for their merger announced a month ago. General meetings to vote on the proposals to merge BASC with JUSC will be held on 2 and 15 December.
