Billionaire Bill Ackman May Be the Next Warren Buffett. He's Buying 2 Magnificent Stocks Up 160% and 270% Since 2023.

Bill Ackman's Pershing Square, a fund that has significantly outperformed the S&P 500, is pursuing a dual-pronged investment strategy: transforming its 46.9% stake in Howard Hughes into a "modern-day Berkshire Hathaway" by acquiring controlling interests in quality businesses, and making substantial investments in public equities. Notably, Pershing Square recently acquired stakes in Amazon (Q2) and Uber (Q1), citing Amazon's resilient retail and cloud computing divisions, along with its potential for AI-driven efficiency gains, and Uber's strong market leadership in ride-sharing and food delivery, bolstered by strategic autonomous vehicle partnerships, with both companies positioned for robust earnings growth.

Analysis

Bill Ackman's Pershing Square, which has outperformed the S&P 500 by 28 percentage points over the last five years, is executing a dual strategy of long-term value creation and tactical large-cap investment. The fund's primary long-term project involves transforming its 46.9% stake in Howard Hughes Holdings into a holding company modeled after Berkshire Hathaway. Concurrently, Pershing has established significant new positions in technology leaders, acquiring a stake in Amazon in Q2 and making Uber its largest holding at 19% of the portfolio as of Q1. The investment thesis for Amazon is based on the resilience of its retail and cloud computing segments and significant, underappreciated upside from AI-driven efficiencies in logistics, which could drive earnings growth beyond the 10% consensus estimate and justify its 36x earnings multiple. The conviction in Uber stems from its dominant market position in both ride-sharing and food delivery, combined with its strategic positioning to capitalize on the autonomous vehicle transition through numerous partnerships, supporting a projected 26% annual earnings growth and a reasonable 16x earnings valuation.

Key Decisions for Investors

• Given Pershing Square's strong performance record, its high-conviction investments in Amazon and Uber warrant consideration, as they reflect a bullish view on technology leaders with durable competitive advantages.
• Investors should assess Amazon's 36x P/E multiple not just on consensus forecasts, but on the potential for AI-driven margin expansion in its retail and logistics operations, which represents a key potential catalyst.
• Evaluate Uber's investment case based on its strategic positioning as a central platform for the future of autonomous mobility, a factor that underpins its 26% annual earnings growth forecast and supports its current 16x earnings valuation.
• For portfolios with a long-term horizon, the strategic intent for Howard Hughes Holdings presents a special situation play on Ackman's ability to execute a value-creation strategy through acquisitions, similar to the early days of Berkshire Hathaway.