A Look At Bill Ackman's Super-Concentrated Equity Portfolio

Activist investor Bill Ackman manages Pershing Square Capital Management, a successful hedge fund firm with a concentrated equity portfolio worth $14.44 billion as of the end of the second quarter of the year.

The equity portfolio comprises only seven stocks; 44 percent of its total assets are allocated to healthcare stocks, 27 percent to materials and 15 percent to transportation stocks. It should be noted that the positions remained almost untouched over the quarter. In fact, the only move was the closing of the Allergan PLC AGN stake.

As of the end of the first quarter, the firm held 1,348,358 shares of Allergan, worth more than $400 million. However, between April and June, Ackman disposed of all of the shares.

Also bearish on the specialty pharmaceutical company are Geode Capital Management, which sold all of its 3,033,026 over the period, and Credit Suisse, which trimmed its exposure by 83 percent, to 156,051 shares.

On the bullish side, there’s Valeant Pharmaceuticals Intl Inc VRX, Ackman’s largest position for the second quarter – same as in the first one. The unchanged stake, comprising 19,473,933 shares, surged in value from $3.86 billion by March 31 to $4.32 billion by June 30.

The bet represents almost 30 percent of the firm’s equity portfolio and about 5.8 percent of the company’s shares outstanding. This makes it the third largest institutional investor in the pharma company, only outranked by Ruane, Cunniff & Goldfarb, which last disclosed ownership of 33,884,050 shares, and T. Rowe Price with 20,463,632 shares. Also worth mentioning is Jeffrey Ubben’s stake. His fund, Valueact Holdings reduced its bet by 22 percent over the quarter, but still holds 14,994,261 shares, or $3.33 billion in stock.

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The other six stocks in Ackman’s portfolio are:

• Air Products & Chemicals, Inc. APD: 20,549,076 shares worth about $2.8 billion
• Canadian Pacific Railway Limited (USA) CP: 13,940,890 shares, $2.23 billion
• Zoetis Inc ZTS: 41,823,145 shares, $2 billion
• Restaurant Brands International Inc QSR: 38,003,984 shares, $1.45 billion
• Platform Specialty Products Corp PAH: 42,737,394 shares, $1 billion
• Howard Hughes Corp HHC: 3,568,017 shares, half a billion dollars

These positions make Pershing Square the largest institutional investor in all of these companies except for Howard Hughes. However, in early July, the firm disclosed an even larger stake in the company, comprising 5,484,684 shares, which made it the biggest shareholder as well.