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David Goodloe
David Goodloe
Articles (769) 

Ackman Pared His Stake in Mondelez International In 1st Quarter

Guru invested in 5 million shares of Valeant

June 13, 2016 | About:

Bill Ackman (Trades, Portfolio) of Pershing Square Capital Management LP made transactions in four stocks in the first quarter, reducing his holdings in two and adding to his holdings in the others.

Ackman pared his stake in Mondelez International Inc. (NASDAQ:MDLZ), a food processing company based in Deerfield, Illinois, by more than 47%. Ackman sold 20,424,117 shares for an average price of $40.73 per share. The deal had a -7.35% impact on Ackman’s portfolio.

The remaining stake of 22,942,225 shares is 1.48% of Mondelez’s outstanding shares and 10.4% of Ackman’s total assets. Ackman is the company’s leading shareholder among the gurus.

Mondelez has a P/E of 9.8, a forward P/E of 21.7, a P/B of 2.5 and a P/S of 2.6. GuruFocus gives Mondelez a Financial Strength rating of 5/10 and a Profitability and Growth rating of 5/10 with an ROE of 27.80% higher than 91% of the companies in the Global Confectioners industry and an ROA of 11.62% that is higher than 86% of the companies in that industry.

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Mondelez sold for $45.02 per share Friday. The DCF Calculator gives Mondelez a fair value of $49.23 with a margin of safety of 9%.

The guru raised his stake in Valeant Pharmaceuticals International Inc. (VRX), a Canadian pharmaceutical company, by more than 30% with the purchase of 5 million shares for an average price of $74.84 per share. The transaction had a 1.48% impact on Ackman’s portfolio.

The stake, now 21,591,122 shares, is 6.29% of Valeant’s outstanding shares and 6.21% of Ackman’s total assets. Ruane Cunniff (Trades, Portfolio) is Valeant’s leading shareholder among the gurus with a stake of 30,308,449 shares. The stake is 8.84% of Valeant’s outstanding shares and 6.19% of Ruane Cunniff (Trades, Portfolio)’s total assets.

Valeant has a forward P/E of 2.8, a P/B of 1.4 and a P/S of 0.8. GuruFocus gives Valeant a Financial Strength rating of 4/10 and a Profitability and Growth rating of 7/10 with an ROE of -12.35% that is lower than 78% of the companies in the Global Drug Manufacturers – Specialty & Generic industry and an ROA of -1.63% that is lower than 72% of the companies in that industry.

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Valeant sold for $24.14 per share Friday. The DCF Calculator gives Valeant a fair value of $-22.79.

Ackman increased his position in Restaurant Brands International Inc. (NYSE:QSR), a Canadian fast food company, by just over 3% with the acquisition of 1,146,567 shares for an average price of $34.76 per share. The deal had a 0.5% impact on Ackman’s portfolio.

The stake, now 39,150,551 shares, is 16.79% of Restaurant Brands’ outstanding shares and 17.17% of Ackman’s total assets. Ackman is Restaurant Brands’ leading shareholder among the gurus.

Restaurant Brands has a P/E of 67.6 and a P/S of 4.9. GuruFocus gives Restaurant Brands a Financial Strength rating of 4/10 and a Profitability and Growth rating of 4/10 with an ROE of 11.05% that is higher than 57% of the companies in the Global Restaurants industry and an ROA of 2.30% that is lower than 62% of the companies in that industry.

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Restaurant Brands sold for $42.28 per share Friday. The DCF Calculator gives Restaurant Brands a fair value of $3.64.

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About the author:

David Goodloe
I'm a journalist by training. I grew up in Arkansas and earned my B.A. at the University of Arkansas. I earned my master's degree at the University of North Texas. My background includes stints at newspapers in Arkansas and Texas and teaching news writing and news editing to students at the University of Oklahoma and Richland College here in Dallas. I'm a writer/editor at GuruFocus.

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