Famous hedge fund manager Bill Ackman is also referred to as an activist investor. In 2003, he founded Pershing Square Capitala investment advisor registered with the United States Securities and Exchange Commission (SEC).
(LON:) (OTC:) is a closed-end funds led by Ackman. Jit finances:
“Makes concentrated investments in publicly traded companies, primarily domiciled in North America. PSH is incorporated in Guernsey…”
In December 2020, PSHP stock joined the the UK’s main stock market index.
As reported by the company in its FY2021 Annual Report reportthe net yield was 26.9% compared to yield of 28.7%.
Over the past year, the stock has increased around 1% and offers a dividend yield of almost 1.5%. According to measurements provided by Investing Prothe financial health of PSHP’s stock is rated 4 out of 5 compared to its peers in the financial sectors.
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Source: InvestingPro
Those interested in participating in the potential growth offered by Pershing Square Holdings could simply purchase PSHP shares. Others might prefer to diversify through exchange-traded funds (ETFs) that provide access to holdings currently held by Pershing Square Capital Management.
Investing Pro website too given access to these names. Readers can follow the group’s relevant 13F filings on the SEC website as well.
Bill Ackman’s portfolio currently includes six companies. Five of them are consumer discretionary stocks and the last is a real estate name. Let’s take a closer look.
Ackman Shares
A quarter of the portfolio is currently in Lowe’s Companies (NYSE:), the home improvement retailer. The company also has the largest market capitalization (cap) among these six holdings.
Since January, the LOW share has lost nearly 20% and the dividend yield stands at 1.59%. Two ETFs that hold LOW are the Invesco Dynamic Building & Construction ETF (NYSE:) and the iShares US Homebuilding ETFs (NYSE:).
Among the six holdings, two names have similar weightings and market caps, namely, hilton (NYSE:)the global hospitality giant, and Chipotle Mexican Grill (NYSE:), the Mexican food chain. Their allocations are around 18.5% and market caps are around $41 billion.
the Kelly Hotel & Lodging ETFs (NYSE:) and the Defiance Hotel, Airline and Cruise ETF (NYSE:) might appeal to those looking to invest in HLT stocks.
For potential investors in CMG shares, the Unusual Portfolio Design Basic Equity ETF (NYSE: UGCE) and the AdvisorShares Restaurant ETF (NYSE:) could offer entry to equities.
The remaining 38% of Pershing’s portfolio is more or less spread across three companies: International restaurant brands (NYSE:), Howard Hughes (NYSE:) and Dominos Pizza (NYSE:). HHC is a real estate company, while the other two are in the restaurant business.
Of these three names, Canada-based QSR stock is the dividend champion with a 3.9% yield. It’s also priced right in terms of fair (or intrinsic) value, as the stock could go up 30%. the Invesco International Dividend Achievers ETF (NASDAQ:) would be an ETF to consider for those who want to invest in QSR.
Revenue growth is an important metric for long-term investors. In this regard, HHC deserves to be on the radar screen as its growth is over 100% year over year. Two other ETFs worth mentioning are the ETFs Genuine Investors (NYSE: GCIG) and the iShares U.S. Real Estate ETF (NYSE:), who invest in HHC. Meanwhile, DPZ shares are also in the EATZ fund.
Readers wondering how Wall Street analysts are pricing these six stocks might want to know that they all offer upside potential from their current levels. For example, LOW could increase by more than 40%. This is followed by CMG (31.5%), HHC (27.6%), QSR (19.7%), DPZ (16.3%) and HLT (4.1%).
Conclusion
Finally, an alternative for the retail investor is to buy an ETF that holds a combination of these stocks. Then the Invesco S&P 500 Equal Weight Consumer Discretionary ETF (NYSE:) deserves further research.
LOW, HLT, CMG and DPZ are all in this ETF. The fund has lost 15.1% since the start of the year, offering long-term investors better value.
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