Bill Ackman: HHH Is Well Positioned To Implement A Similar Approach To Berkshire

Pershing Square Holdings delivered strong performance in the first half of 2025, with its NAV per share, including dividends, increasing 15.5%, compared with a 6.2% return for the S&P 500 over the same period. Chairman Rupert Morley noted that “the Board is pleased to report that PSH delivered strong absolute and relative performance,” attributing this to a disciplined approach to investing in excellent businesses that are “largely insulated from external shocks, including tariffs and macro-driven volatility.”

In his letter to shareholders, Bill Ackman highlighted that “investors who invested in Pershing Square, L.P. at its inception on January 1, 2004, and transferred their investment to PSH at its inception on December 31, 2012 (‘Day One Investors’) have grown their equity investment at a 16.4% compound annual rate over the last nearly 22 years.”

This long-term perspective underscores the firm’s commitment to compound growth. Ackman also addressed the current discount to NAV at which PSH shares trade, stating, “Our strong preference is for PSH’s shares to trade at or around intrinsic value for which we believe PSH’s NAV per share is a conservative estimate.”

Portfolio activity this year has been unusually active. Ackman explained, “The large amount of stock price volatility this year – largely associated with tariffs and other geopolitical issues – created significant opportunities.”

This led to new investments in Amazon and Hertz, additions to existing holdings like Brookfield and Alphabet, and the exit of Canadian Pacific, which was “more sensitive to tariffs and other macroeconomic factors relative to the rest of the portfolio.”

A significant strategic development was the investment in Howard Hughes Holdings, with plans to transform it into a diversified holding company. Ackman drew a parallel to Berkshire Hathaway, noting that “HHH’s MPC business will begin to generate substantial and growing cash flows that will not be required to be reinvested in its MPCs and can therefore be redeployed into building a diversified holding company.”

The firm believes “HHH is well positioned to implement a similar approach to Berkshire.”

Looking ahead, Ackman expressed optimism, noting, “Inflation appears to have moderated, setting up the prospects for Fed easing,” and that “AI is starting to generate productivity gains while driving massive new investment.”

However, he added a note of caution: “Markets are ebullient. Signs of speculative activity are everywhere. In short, we are heading into a strong economic backdrop, but investment selection will be paramount.” This balanced view reflects Pershing Square’s focus on careful stock selection amidst a complex market environment.

You can find the entire Shareholder Letter & Financial Statements here:

Pershing Square Holdings-Interim Financial Statements-June 30, 2025