Dan Loeb and Bill Ackman are billionaire activist investors who own hedge funds Third Point Management and Pershing Square Capital Management, respectively.
Both have been outspoken in the media this year, as Loeb wanted Disney to sell its unprofitable ESPN segment. After that, Loeb directed his focus toward Colgate-Palmolive’s pet food subsidiary Hill’s Pet Nutrition, which is delivering faster growth and better margins than the business as a whole.
In June 2022, Ackman took to Twitter to report consumer confidence is weak because of inflation and not the economy, adding that the Federal Reserve needs to “act decisively to kill inflation and inflationary expectations.” On Thursday’s quarterly call with investors, Ackman said it is unlikely the Fed will be able to get inflation down to a constant 2% level.
What Was Bought?
During the third quarter, Loeb opened a new stake in Bath & Body Works Inc BBWI, purchasing more than 8.1 million shares accounting for 4.8% of the total portfolio.
Loeb also opened a new stake in TJX Companies Inc TJX, purchasing exactly 1.75 million shares totaling 2% of the portfolio.
Loeb opened a stake in Twitter, buying roughly 5.5 million shares making it worth 4.4% of the portfolio. Unless Loeb was solely looking to profit off the arbitrage opportunity, his new stake in Twitter would be even more interesting if he is planning on keeping it.
What Was Sold?
Ackman completely sold more than 2 million shares worth of Domino's Pizza Inc DPZ over the course of the third quarter, which represented 11% of the total fund. Ackman first opened a stake in Domino's Pizza during the first quarter of 2021 and did not add much to it since then.
What Was Traded?
Out of Ackman’s six stock portfolios, Howard Hughes Corp HHC and Chipotle Mexican Grill, Inc. CMG were the only two positions he did not add to.
During the third quarter, Ackman increased the fund's stake Lowe's Companies Inc LOW by purchasing more than 160,000 shares (totaling 25% of the portfolio), Restaurant Brands International Inc QSR by more than 370,000 shares (totaling 16%), Hilton Hotels Corporation HLT by more than 122,000 shares (totaling 15%), and Canadian Pacific Railway Ltd CP by roughly 12.3 million shares (totaling 13%).
Since Loeb’s portfolio covers at least 61 stocks, we will discuss two stocks he bought large chunks of during the third quarter. Loeb increased his stake in Colgate-Palmolive Company CL by at least 9.5 million shares making it his top-owned position (totaling 15% of the portfolio).
Loeb also increased his stake in Walt Disney Co DIS by approximately 400,000 shares, as the activist investor has been quite outspoken about the firm.
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