(GuruFocus, December 4, 2009) Investment Guru Bill Ackman has published his letter to Pershing Square Investors for 3Q09. A copy can be assessed at the end of this post. Overall, the multiple partnerships he set up have done very well for the quarter and for the year, reaping gains more than 23% for each one for them net of all fees, beating the S&P 500 by a large margin.
Market as a whole has done well too, for the year and for the quarter. Ackman does not believe the outperformance is due to luck, nor does he think he has an advantage in predicting the market and economic direction. He thinks it is the capability in selecting the right kind of investment that delivers the outperformance. As his historical experience shows, when the price of the selected investment converges with the intrinsic value, profits have been made.
As of September 30, 2009, Ackman reported a $3.13 billion long equity portfolio that is traded in the US. The funds were concentrated among seven stocks. As you read Ackman’s letter, keep in mind that these are companies he has most money in:
No. 1: Target Corp. (TGT, Financial), Weightings: 38.8% - 26,012,799 Shares
Target Corporation operates large-format general merchandise and food discount stores in the United States, which include Target and SuperTarget stores. Target Corp. has a market cap of $34.85 billion; its shares were traded at around $46.35 with a P/E ratio of 16.1 and P/S ratio of 0.6. The dividend yield of Target Corp. stocks is 1.5%. Target Corp. had an annual average earning growth of 11.6% over the past 10 years. GuruFocus rated Target Corp. the business predictability rank of 5-star.
No. 2: EMC Corp. (EMC, Financial), Weightings: 31.95% - 58,678,780 Shares
EMC Corporation and its subsidiaries design, manufacture, market and support a wide range of hardware and software products and provide services for the storage, management, protection and sharing of electronic information. Emc Corp. has a market cap of $33.65 billion; its shares were traded at around $16.64 with a P/E ratio of 25.9 and P/S ratio of 2.3. Emc Corp. had an annual average earning growth of 39.1% over the past 5 years.
No. 3: McDonald's Corp. (MCD, Financial), Weightings: 15.04% - 8,245,412 Shares
McDonald's Corporation develops, operates, franchises and services a worldwide system of restaurants that prepare, assemble, package and sell a limited menu of value-priced foods. The company operates primarily in the quick-service hamburger restaurant business. Mcdonald's Corp. has a market cap of $67.63 billion; its shares were traded at around $61.97 with a P/E ratio of 16.3 and P/S ratio of 2.9. The dividend yield of Mcdonald's Corp. stocks is 3.3%. Mcdonald's Corp. had an annual average earning growth of 7.2% over the past 10 years.
No. 4: Automatic Data Processing Inc. (ADP, Financial), Weightings: 7.68% - 6,118,353 Shares
Automatic Data Processing, Inc. is one of the largest providers of computerized transaction processing, data communication, and information services in the world. Automatic Data Processing Inc. has a market cap of $21.69 billion; its shares were traded at around $43.19 with a P/E ratio of 18 and P/S ratio of 2.5. The dividend yield of Automatic Data Processing Inc. stocks is 3%. Automatic Data Processing Inc. had an annual average earning growth of 4.1% over the past 10 years. GuruFocus rated Automatic Data Processing Inc. the business predictability rank of 4-star.
No. 5: Corrections Corp. of America New (CXW, Financial), Weightings: 5.32% - 7,355,620 Shares
Corrections Corporation of America Company is the one of nation's largest providers of detention and corrections services to governmental agencies. Corrections Corp. Of America New has a market cap of $2.91 billion; its shares were traded at around $25.22 with a P/E ratio of 20.4 and P/S ratio of 1.8. Corrections Corp. Of America New had an annual average earning growth of 7% over the past 5 years.
No. 6: Borders Group Inc. (BGP, Financial), Weightings: 1.05% - 10,597,980 Shares
Borders Group, Inc. , through its subsidiaries, is a premier operator of book and music stores. Borders Group, Inc. conducts its business via superstores, mall-based stores, or the Internet. The company's presence is felt not only in the U.S. , but worldwide. Borders Group Inc. has a market cap of $66.9 million; its shares were traded at around $1.11 .
GuruFocus provides real time information and insights of Investment Gurus such as Warren Buffett and Bill Ackman for Premium Members. If you are not a premium member, click here to sign up or upgrade. 7-Day Free Trial is available.
Pershing Square Third Quarter Investor Letter
Also check out:
Market as a whole has done well too, for the year and for the quarter. Ackman does not believe the outperformance is due to luck, nor does he think he has an advantage in predicting the market and economic direction. He thinks it is the capability in selecting the right kind of investment that delivers the outperformance. As his historical experience shows, when the price of the selected investment converges with the intrinsic value, profits have been made.
As of September 30, 2009, Ackman reported a $3.13 billion long equity portfolio that is traded in the US. The funds were concentrated among seven stocks. As you read Ackman’s letter, keep in mind that these are companies he has most money in:
No. 1: Target Corp. (TGT, Financial), Weightings: 38.8% - 26,012,799 Shares
Target Corporation operates large-format general merchandise and food discount stores in the United States, which include Target and SuperTarget stores. Target Corp. has a market cap of $34.85 billion; its shares were traded at around $46.35 with a P/E ratio of 16.1 and P/S ratio of 0.6. The dividend yield of Target Corp. stocks is 1.5%. Target Corp. had an annual average earning growth of 11.6% over the past 10 years. GuruFocus rated Target Corp. the business predictability rank of 5-star.
No. 2: EMC Corp. (EMC, Financial), Weightings: 31.95% - 58,678,780 Shares
EMC Corporation and its subsidiaries design, manufacture, market and support a wide range of hardware and software products and provide services for the storage, management, protection and sharing of electronic information. Emc Corp. has a market cap of $33.65 billion; its shares were traded at around $16.64 with a P/E ratio of 25.9 and P/S ratio of 2.3. Emc Corp. had an annual average earning growth of 39.1% over the past 5 years.
No. 3: McDonald's Corp. (MCD, Financial), Weightings: 15.04% - 8,245,412 Shares
McDonald's Corporation develops, operates, franchises and services a worldwide system of restaurants that prepare, assemble, package and sell a limited menu of value-priced foods. The company operates primarily in the quick-service hamburger restaurant business. Mcdonald's Corp. has a market cap of $67.63 billion; its shares were traded at around $61.97 with a P/E ratio of 16.3 and P/S ratio of 2.9. The dividend yield of Mcdonald's Corp. stocks is 3.3%. Mcdonald's Corp. had an annual average earning growth of 7.2% over the past 10 years.
No. 4: Automatic Data Processing Inc. (ADP, Financial), Weightings: 7.68% - 6,118,353 Shares
Automatic Data Processing, Inc. is one of the largest providers of computerized transaction processing, data communication, and information services in the world. Automatic Data Processing Inc. has a market cap of $21.69 billion; its shares were traded at around $43.19 with a P/E ratio of 18 and P/S ratio of 2.5. The dividend yield of Automatic Data Processing Inc. stocks is 3%. Automatic Data Processing Inc. had an annual average earning growth of 4.1% over the past 10 years. GuruFocus rated Automatic Data Processing Inc. the business predictability rank of 4-star.
No. 5: Corrections Corp. of America New (CXW, Financial), Weightings: 5.32% - 7,355,620 Shares
Corrections Corporation of America Company is the one of nation's largest providers of detention and corrections services to governmental agencies. Corrections Corp. Of America New has a market cap of $2.91 billion; its shares were traded at around $25.22 with a P/E ratio of 20.4 and P/S ratio of 1.8. Corrections Corp. Of America New had an annual average earning growth of 7% over the past 5 years.
No. 6: Borders Group Inc. (BGP, Financial), Weightings: 1.05% - 10,597,980 Shares
Borders Group, Inc. , through its subsidiaries, is a premier operator of book and music stores. Borders Group, Inc. conducts its business via superstores, mall-based stores, or the Internet. The company's presence is felt not only in the U.S. , but worldwide. Borders Group Inc. has a market cap of $66.9 million; its shares were traded at around $1.11 .
GuruFocus provides real time information and insights of Investment Gurus such as Warren Buffett and Bill Ackman for Premium Members. If you are not a premium member, click here to sign up or upgrade. 7-Day Free Trial is available.
Also check out:
