Bill Ackman: Buying Durable Growth at Bargain Prices

Bill Ackman’s latest Annual Report arrives at a moment when equity investors are balancing optimism with caution. His perspective reflects confidence in long-term business fundamentals while acknowledging that short-term trading behavior has shifted in notable ways.

As he put it, “The market increasingly appears like a casino where money is wagered over the course of a day, hours, minutes or even seconds.”

That observation speaks to a broader structural change in how equities trade. Passive ownership, leveraged strategies, and algorithmic activity can amplify volatility even when corporate performance remains steady.

Ackman explains the dynamic clearly: “We believe that current market dynamics are due to the ever-growing percentage of capital controlled by highly-leveraged market participants who have extremely short-term objectives, and are incentivized or required to exit when certain stop loss triggers are hit due to margin and/or total-return swap leverage and/or risk limits, amplified by the reduction in float due to growing index ownership.”

For disciplined investors, this environment may create opportunity rather than risk alone. He stresses the disconnect between business duration and shareholder time horizons, noting, “This mismatch between stocks, which represent perpetuity interests in businesses that are inherently long-term assets, and their temporary ‘owners,’ creates growing opportunities for the patient investor with stable capital.”

That emphasis on patience has long defined his investment philosophy and remains central to how his firm approaches market turbulence.

That philosophy underpins Pershing Square’s strategy today. Ackman adds, “Because of our permanent capital structure, the increasingly volatile market dynamics will likely continue to offer us occasionally extraordinary opportunities to buy the highest quality durable growth companies in the world at bargain prices.”

The implication is straightforward: volatility can produce mispricing, and mispricing can reward investors willing to maintain a longer horizon.

Beyond market mechanics, valuation remains critical to his outlook. Despite strong index performance in recent years, he emphasizes that earnings growth, not speculation, has driven much of the advance.

In his words, “While the stock market could decline materially from current levels for reasons that are today unknown, the stock market’s advance has been largely supported by earnings growth rather than speculative excess.”

This framing suggests selective optimism rather than blanket enthusiasm. Companies with durable competitive advantages, strong cash generation, and capable management continue to attract his attention, particularly when volatility produces price dislocations.

The approach is less about forecasting macro events precisely and more about consistently evaluating intrinsic value and capital allocation discipline.

Ackman ultimately expresses a constructive stance on the broader outlook. Summing up his position succinctly, he writes, “We are constructive on the current economic and market backdrop and on Pershing Square Holdings.” For investors assessing equities today, his message reinforces a familiar principle: patience, valuation discipline, and business quality still matter most, especially when markets grow noisy.

You can read the entire letter here:

Pershing Square Annual Report 2025