Contrarian Corpus
activist full deck follow up
2015-01-29 · 81 pages

Pershing Square Portfolio (multi-position annual update)

Pershing Square delivered 40.4% net in 2014 — Allergan's sale to Actavis, Herbalife's 50% drop and Seifi Ghasemi's Air Products turnaround — and IPO'd PSH for permanent capital.

Thesis

Pershing Square's 2014 annual update recaps a 40.4% net return year (vs. 13.7% for the S&P 500) and introduces Pershing Square Holdings, Ltd. — a $2.8bn Euronext-listed closed-end vehicle giving the firm permanent capital. The portfolio narrative is led by Allergan: Pershing partnered with Valeant in a 9.7% co-bidder stake, an unsolicited $153 offer triggered a sale to Actavis at $219, lifting the stock 71% in-year. The Herbalife short fell 52% in 2014 amid FTC, DOJ, FBI, NY/IL AG probes and worldwide volume points collapsing from +13% to 0%. Air Products rose 32% under new CEO Seifi Ghasemi, who is pushing EBIT margins from 16% toward Praxair's 22.5%. Canadian Pacific (Hunter Harrison) and the Burger King/Tim Hortons merger round out the year.

The three reasons

  1. 1

    Pershing Square, L.P. returned 40.4% net in 2014 vs. 13.7% for the S&P 500

  2. 2

    PSH IPO raised $2.8bn of permanent capital, lengthening Pershing's investment runway

  3. 3

    Allergan ($219 sale to Actavis), Herbalife short and Air Products turnaround drove the year

KPIs cited

2014 net return (Pershing Square, L.P.)
40.4% vs. S&P 500 13.7%
Cumulative net return since 2004 inception
696.2% vs. S&P 500 132.1%
Allergan share price
+71% in 2014; sold to Actavis at $219 vs. $128 cost
Herbalife share price since short inception (5/1/2012)
down 41% including dividends, to $31
Herbalife worldwide volume points YoY growth
fell from +13% (Q3'13) to 0% (Q3'14)
Air Products EBIT margin
16% today vs. Praxair 22%; target 22.5%
Air Products share price
+32% in 2014; +57% since inception
Canadian Pacific Operating Ratio
64.7% in 2014, third-best in industry
CP share price since inception (9/22/2011)
+384% including dividends
Restaurant Brands International share price
+72% in 2014 post Tim Hortons merger
Total Firm AUM (12/31/14)
$18.3bn
PSH permanent capital share of fund AUM
36% permanent + 10% GP = 46% locked

Pattern membership

Where this document fits across the library's 12 rhetorical / structural patterns. Orange cells are present in this deck; neutral cells are not.

Precedents cited

  • CN Rail transformation under Hunter Harrison (template for CP)
  • Rockwood / BOC turnarounds under Seifi Ghasemi (template for APD)
  • Praxair operating model (peer benchmark for APD margins)

Composition what's on the 81 slides

Visual + textual elements counted across every slide in this deck. Hover a box for what that element is; click to see every slide in the corpus that uses it.

Slide gallery ·

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Notes

Fund-level annual investor update, not a single-target campaign deck. Covers Allergan, Herbalife (short), Air Products, Canadian Pacific, Restaurant Brands International (Burger King/Tim Hortons), Platform Specialty, Zoetis, Howard Hughes, Fannie/Freddie. Author credited as the firm only (Pershing Square Capital Management, L.P.) — no Ackman signature on cover. SCQA fields nulled because there is no single thesis (per guidance for fund-level updates). Notable rhetorical device: Herbalife slide quotes Chairman's Club distributor Stephan Gratziani admitting 'a level of inauthenticity' — insider-quote-contradiction pattern. APD vs Praxair margin gap (16% vs 22%) is asserted in text, not as a chart, so contains_peer_gap_chart is false. Annotated stock-price timeline charts (HLF, Allergan, CP, APD) are the most reusable slides. Many gray section-divider pages inflate page count.