“My fund’s stock price is, frankly, absurd”: Bill Ackman buys back into Netflix after suffering losses

Prominent activist investor Bill Ackman has voiced strong dissatisfaction with the market performance of his closed-end fund, Pershing Square USA (PSUS). Ackman described the fund's current trading price, which is more than 22% below its net asset value, as "frankly absurd." This significant discount highlights investor skepticism or a lack of demand for the fund, despite its underlying assets.

“

The winner this week will receive an exemption into the 2027 U.S. Junior Amateur, which is the USGA’s version of this tournament. As well, they’ll get into the 122nd Canadian Men’s Amateur Championship and then the winner from that gets into the Canadian Open, so this can really propel someone into next year and potentially the future.

The fund's investment returns have also lagged considerably behind the market. Since its listing in April, PSUS has generated a mere 0.6% return. In stark contrast, the S&P 500 index, fueled by gains in AI-related stocks, has surged by 13.7% over the same period. Pershing Square's funds have largely missed out on the semiconductor and AI infrastructure rally that has driven the market, with existing holdings like Fannie Mae and Universal Music Group further dragging down performance.

In response to the underperformance and the valuation gap, Pershing Square has undertaken a significant portfolio reshuffling. The fund has recently acquired stakes in Visa, Mastercard, S&P Global, Intercontinental Exchange (ICE), Alcon, and notably, Netflix. This marks a notable return to Netflix, a company from which Pershing Square previously divested its entire stake after incurring losses exceeding $400 million in 2022, following a subscriber decline announcement.

“

It’s great to have these bigger events in our home province. Like last year we were in New Brunswick, that’s a pretty far trek, but it’s nice when these big events come. You know, I’m two and a half hours away instead of a four-hour flight.

Ackman acknowledged that the initial public offering (IPO) process for PSUS may have contributed to the current situation, suggesting that a substantial allocation to retail investors who subsequently sold shares could have impacted the price. To address the discount, Ackman plans to initiate marketing campaigns aimed at financial advisors to increase demand for PSUS. He also intends to launch a new fund focused on venture capital investments.

“

The past two years I’ve played we’ve had two guys make the cut. However, many went and this is definitely the most we’ve had in a couple years and it’s nice to see especially in our home province.