Billionaire Bill Ackman Has 43% of His Hedge Fund's $14.8 Billion Portfolio Invested in Just 3 Stocks

Bill Ackman is 1 of the astir intimately followed portfolio managers successful the world. His astir caller effort to bring his portfolio absorption skills to mundane investors progressive acquiring power of Howard Hughes Holdings. Ackman's hedge fund, Pershing Square Capital, already owns astir 37% of the company's outstanding shares.

But mundane investors don't person to hold astir for a analyzable acquisition to spell through, if it ever does. They tin put successful Ackman's champion ideas close present by simply pursuing his nationalist disclosures for Pershing Square. The hedge fund's $14.8 cardinal portfolio is heavy concentrated successful conscionable a fistful of companies with 3 accounting for 43% of its value.

Here are Ackman's favourite investments close now.

Uber Technologies (NYSE: UBER) is the newest summation to Pershing Square's portfolio, and it's a large stake by Ackman. He disclosed a acquisition of 30.3 cardinal shares of the ride-sharing institution successful aboriginal February. Those shares are worthy astir $2.3 cardinal arsenic of this writing.

In his yearly shareholder presentation, Ackman pointed to Uber's web effect arsenic the biggest crushed he's bullish connected the company. Indeed, Uber is the largest ride-sharing web extracurricular of China. It's already leveraged that web of drivers and customers to physique Uber Eats and a broader transportation service, which present accounts for fractional of its volume.

Uber's presumption arsenic the biggest request aggregator shields it from the imaginable disruption of autonomous vehicles (AVs). Uber positioned itself arsenic an indispensable spouse for AV companies looking to physique a robotaxi service. Since Uber tin aggregate request and supplement AV proviso with quality drivers, it tin guarantee precocious utilization rates for AV companies. AV companies going it unsocial volition person a bulk of their fleet not successful usage passim the day.

As such, Ackman sees management's guidance for 30% to 40% yearly net earlier interest, taxes, depreciation, and amortization (EBITDA) maturation implicit the adjacent fewer years arsenic achievable. Management besides called for 90%-plus mean yearly free-cash-flow maturation implicit the adjacent 3 years astatine the commencement of 2024. Free currency travel grew 122% past year.

With specified beardown maturation up of it, Uber's guardant P/E ratio of astir 31 arsenic of this penning looks similar a large value.

Ackman scooped up a sizable presumption successful Alphabet (NASDAQ: GOOG) (NASDAQ: GOOGL) successful aboriginal 2023 amid fears that generative artificial quality (AI) start-ups would disrupt its Search product. The banal climbed 40% by the clip Ackman wrote his midyear update to Pershing Square shareholders successful June. Even then, helium said the banal inactive looked attractive. And the terms has moved different 48% higher since. Pershing Square's involvement successful Alphabet is present worthy astir $2 billion.