We're posting up notes from the Ira Sohn Conference 2013 in New York. Next up is a summary of the presentation from Bill Ackman of Pershing Square Capital. He presented "A Rising Tide is a Good Gamble," a pitch on shares of Procter & Gamble (PG).
Procter & Gamble (PG)
Ackman seemed more subdued than usual, perhaps chastened from the Herbalife (HLF) short criticism he's received lately. His idea was long PG. 40% of revenue is from the emerging markets. Says P&G is under-earning because of a bloated overhead cost structure, never brought over Gillette’s cost-conscious culture.
Suboptimal manufacturing, too many layers of management, marketing is 16.5% of revenue and they aren't getting their proper return on that investment. Pricing in some categories is not optimized. These are fixable.
Company itself has recognized their "bloat" and has announced $10B of cost reduction, $6B from COGS, etc. Then several pages of slides going over how they can cut costs.
For more resources on this hedge fund manager, we've posted up about Ackman's Mondelez stake as well as his presentations on Herbalife.
Check out the rest of the hedge fund presentations from the event: notes from Ira Sohn Conference 2013.
Thursday, May 9, 2013
Bill Ackman's Sohn Conference Presentation on Procter & Gamble (PG)
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