Bill Ackman: Outlook for 2022

pershing square holdings manager bill ackman is with me today to talk about what investors might see over the coming months i've certainly seen a lot of industries seen a recovery in sales particularly as the covert vaccine was rolled out but it does seem like there's quite a few companies are finding it hard to sustain that sort of sales growth momentum now i was just wondering given that you're you've got this reputation as an activist investor do you think now is quite a good time to go and uh invest in a company that might have stalled be quite a good time to sort of push for changes or different management just wondering if you had a fresh target in mind at all so our our strong preference is to find a business that's already doing the right thing with a management team we like at a price we like um and we've been able to find that in the last several years uh starbucks prime example um agilent but even with well-run great companies you know we can be helpful um and uh we are always looking for the next big idea we don't disclose it until we obviously identify it um but i do think it's remain you know we don't need an asset target-rich environment to do well we're going to make one or two new investments a year that's kind of been the history of the firm um and we think we can find one of those in pretty much any market environment you know one investment this year so far is domino's pizza um the other thing we did this year was this interest rate hedge which has been it's up about four-fold since we we've made the investment uh and we're always working on new ideas and i look forward to telling you about one after we're in a position to do so but the sales stalling wouldn't be a reason for us to buy a stake in a company um what caught what motivated us to buy a stake in a company is we thought it was a really great business and it was undervalued and if we thought the reason for undervaluation was fixable whether we fixed it or the current management team fixed it but our strong preference is just to work with existing team okay so obviously that there's lots of pressures on companies at the moment inflation higher energy prices um you know it does look like it's you know markets are doing well at the moment but there's lots of pressures in the background where do you see markets going into 2022 do you think we could see a correct market correction or actually that's there's not reason any no reason to get to sort of panic at the moment yeah so i would say predicting short-term stock market movements is pretty much a fool's game and it's not something we do um all of that said it's it's an uncertain world is it a more uncertain world today than it was a year ago or five years ago you know maybe probably who knows um but that's why the emphasis of our strategy is owning these what i call super durable undisruptible companies right people are going to be ordering pizza and having it delivered and they're going to eat it and if for eight dollars you can feed your family of four with a pizza pie that's a pretty good proposition you get delivered in 28 minutes by smiling person it comes in a box and keeps it warm that's going to continue you know uh chipotle is you know building a couple hundred you know 200 200 plus stores a year and they are earning extraordinary returns when they open those stores and they provide a great product that the customer loves um you know lowe's is the second number two to home depot in the home improvement space but um marvin ellison new ceo over the last several years has come in and done a fantastic job there's no reason why that business shouldn't be neck and neck with home depot and he's and he's made enormous progress taking market share et cetera we think that continues um we think um you know hilton um you know hilton stock was down the most i think of anything we owned when the pandemic was announced we meaningfully increased our position the company in the mid 50s stock today is 140. they've figured out how to uh run hotels more cost efficiently and hilton itself doesn't own any meaningful number of hotels the capital and the hotels are owned and put up by others and health benefits of brand royalty on those companies so when you own businesses that have very very attractive economic characteristics and they're largely immune not immune on a day-to-day basis but they're protected from interest rates moving up or down or commodity prices moving up or down i think that maybe the single most important characteristic today is going to be pricing power you know if the cost of your inputs go up better be able to raise price not lose the customer and that is true for every one of our companies well bill ackman from pershing square holdings thank you very much for joining me appreciate the time thank you [Music]

Channel: AJ Bell

Views: 61,326

Keywords: investing, Bill Ackman, AJ Bell, Pershing Square, Shares, Stocks, Youinvest, FTSE 100

Id: 39q6g3Ao58Q

Length: 5min 9sec (309 seconds)

Published: Tue Nov 02 2021