NEW YORK (
Bill Ackman's Pershing Square's investment fund added two big holdings last quarter,
(LOW - Get Report) and
(CP - Get Report).
No holdings were reduced, while Ackman added to his positions in
(C - Get Report) and, to a lesser extent,
(FDO - Get Report).
| Bill Ackman
Details of the new investments were revealed in a regulatory report. Of Ackman's 10 investments in the fund, Lowe's is No. 7, representing 7.1% of the fund. Canadian Pacific was No. 8, at 3.3%. But that didn't account for shares of the Calgary-based railroad company acquired after the quarter ended.
(JCP - Get Report) and
General Growth Properties
(GGP - Get Report) remained unchanged. They're the two biggest positions, at 18% and 15% of the portfolio.
Ackman announced the purchase of Lowe's at an investor conference last week. According to the filing, he acquired 21 million shares of the home-improvement store in the third quarter. The investment was valued at $410 million as of Sept. 30. Lowe's, in the midst of a turnaround effort, reported third-quarter earnings that declined 44%. In response, Moody's and Fitch each downgraded the company's credit rating by two notches, as they expect the housing market to remain sluggish.
While Ackman's angle on the investment in Lowe's is unclear, there's lots of room for improvement at the retailer. Ackman could also find value in Lowe's real estate, which is 89% company-owned.
>>View Bill Ackman's Portfolio
The 13-F filing released late yesterday shows a 2.4% stake in Canadian Pacific at the end of September, though Ackman announced a 12.2% ownership position in in a separate filing Oct. 18. In that filing, he said he believed the shares of Canadian Pacific were undervalued and planned to have conversations with management, the board or other stockholders about the business.
Ackman is known for making large investments in companies, and then pushing for asset sales or other strategic changes he believes will boost the stock price. However, Ackman told
he didn't plan to push the company to sell itself.
Ackman's plan to unlock value in these two new investments remains uncertain, but given his track record as an activist investor, he will be making noise, so the story has just begun.
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