Pershing Square Capital Management, the hedge fund firm led by Bill Ackman, added new companies to its investment portfolio for the first time in over a year in the second quarter of 2024, with wagers on Nike and Brookfield, according to a report by Reuters.
The report cites a 13F regulatory filing released on Wednesday as revealing the sportswear giant and the investment management firm as the first Pershing’s first portfolio additions since an investment in Google’s parent company, Alphabet in early 2023.
According to the filing, Pershing Square, which manages approximately $17bn in assets, acquired about three million shares of Nike and 6.8m shares of Brookfield as of 30 June. These holdings represent roughly 0.19% of Nike and 0.34% of Brookfield, respectively.
Nike’s stock has fallen 26% since the beginning of the year but saw a 4% increase in after-hours trading following speculation that an activist investor had taken a significant stake and might push for changes. The company is grappling with slowed sales growth and increased competition from brands such as Adidas, On Holding, and Deckers’ Hoka, leading it to introduce more affordable products globally and ramp up marketing for the recent Olympics.
Ackman previously earned a $100m profit from a passive investment in Nike made in late 2017, although Pershing, which is know for its activist style may adopt a different investment approach this time.
The 13F filing also reveals that Pershing Square reduced its stake in Chipotle Mexican Grill by 23% during the second quarter, holding 28.8m shares as of 30 June. Pershing benefited from a tenfold increase in the company’s stock price, after Ackman played a key role in recruiting Brian Niccol as Chipotle’s CEO in 2018. Niccol was recently appointed as the new CEO of Starbucks.
The filing also shows that Pershing reduced its stake in Alphabet, cutting its Class C shareholding by approximately 20% to 7.5 million and its Class A shares by 8.5% to 3.9m.
As of early August, Ackman’s Pershing Square Holdings fund has seen a 4.4% decline, while the broader stock market has gained 15% since January.
