Pershing Square Q3 Letter: Restructures Herbalife Short

Bill Ackman is out with Pershing Square's third quarter letter to investors.  Pershing Square returned -3.7% net in the third quarter and was down 4.2% for the year at that time.

Pershing has restructured its short position in Herbalife (HLF).  Rather than shorting common stock, they've covered that and are now short via put options.

Ackman is also quite bullish on Mondelez (MDLZ): "We believe MDLZ is currently substantially undervalued given its high business quality, long-term secular growth potential - especially in emerging markets - and substantial opportunity to improve profit margins.  Today, Mondelez trades at 17 times our estimate for 2018 earnings per share, a discount to the S&P 500 market multiple, for a business whose attributes are substantially better than the average company in the S&P 500."

The letter also provides updates on their holdings: Restaurant Brands (QSR), ADP (ADP), Howard Hughes (HHC), Chipotle (CMG), Fannie Mae / Freddie Mac, Platform Specialty Products (PAH).

Embedded below is Pershing Square's Q3 letter:



For more recent hedge fund commentary, we've also posted up Third Point's Q3 letter as well as Greenlight Capital's Q3 letter.

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What We're Reading ~ 11/16/17

15 questions to ask management teams [Clear Eyes Investing]

Jim Chanos betting against dialysis companies [Reuters]

A handful of value managers hoard cash as stocks surge [Bloomberg]

How the right decisions and compounding can lead to huge results [Of Dollars and Data]

The nature of underperformance and why it pays to wait [Of Dollars and Data]

CenturyLink / Level 3 merger: 1+1 = 1/2 ? [Peridot Capitalist]

America's 'retail apocalypse' is really just beginning [Bloomberg]

Withdrawal symptoms: cash is still king in India [SCMP]

How India is moving toward a digital-first economy [HBR]

Byron Wien measures China's tech success [Barrons]

In-depth interview with Shake Shack's Danny Meyer [CBS]

America's coffee market is getting too crowded [WSJ]

Who is investing in e-sports startups? [VentureBeat]

A look at Entercom: CBS Radio Reverse Morris Trust [Clark Street Value]