Mike Blake/ Reuters
- Bill Ackman's hedge fund sold Starbucks and bought Domino's Pizza last quarter.
- The billionaire investor pounced when the pizza chain's stock slumped in March.
- Pershing Square trimmed its Agilent, Chipotle, Hilton, and Restaurant Brands bets.
- See more stories on Insider's business page.
Billionaire investor Bill Ackman swapped out Starbucks for Domino's Pizza and trimmed all but one of the other holdings in his stock portfolio last quarter, a regulatory filing revealed this week.
Ackman's Pershing Square Capital Management sold its almost 1% stake in Starbucks, which was worth $1.1 billion at the end of December. The hedge fund also bought more than 5% of Domino's Pizza – a position valued at about $750 million as of March 31.
Ackman explained the move at a recent Wall Street Journal event. Starbucks stock had rebounded faster than expected, he said, while Domino's stock slumped in March to its lowest since the pandemic tanked markets last spring.
"We've admired it for years, and it was just never cheap enough," Ackman said about the pizza-delivery chain. "Then for about five minutes, it got cheap. I don't know who sold or why, but we started buying around $330 a share, and then very quickly it moved up a lot."
Pershing's newest position has jumped in value by another 18% since March 31, to over $880 million as of Monday's close.
Ackman and his team also reduced their stakes in Agilent, Lowe's, Hilton, and Restaurant Brands by 3% to 4%, and their Chipotle stake by around 6%. In contrast, they boosted their Howard Hughes position by about 23% to 13.5 million shares.
Pershing's stake in Lowe's was worth $2.3 billion at the end of March, making the home-improvement retailer its most valuable holding. Its Agilent, Chipotle, Hilton, and Restaurant Brands positions were worth about $1.5 billion each, while its Howard Hughes stake was valued at $1.3 billion. The overall value of its stock portfolio grew 5% to $10.5 billion.
Ackman's next major update could be related to his $5 billion special-purpose acquisition vehicle, Pershing Square Tontine Holdings. The investor is hoping to announce a deal to buy a minority stake in an "iconic" private business in the next few weeks.