Ackman Cuts Target Stake, Shows off Concentrated Portfolio

After a long and tortuous saga, William Ackman is scaling back his big bet on Target (TGT). In a recent filing with the SEC, Ackman indicated that his hedge fund Pershing Square had reduced its outsized stake in the discount retailer by nearly half. Ackman was mostly selling call options in Target, and as of the end of Q2, Ackman’s equity stake in Target was unchanged from the prior quarter.

In a year of bad bets, William Ackman’s 2008 leveraged bet on the discount retailer went spectacularly bad. According to Bloomberg, Ackman’s Pershing Square IV fund, which used options to make a leveraged bet on shares of Target, had fallen -90% as of early February. In the midst of all this, Ackman tried and failed to secure a slate of board seats as he pushed for changes at the company.

Looking at Pershing’s U.S.-listed, equity holdings from the end of Q2, one can see Ackman’s then still unchanged Target stake at the center of an increasingly narrowly-focused long portfolio. During the quarter, Pershing upped stakes in McDonald’s (MCD), tech blue chip EMC (EMC), and outsourcing firm Automatic Data Processing (Nasdaq: ADP).

Pershing held steady with stakes in book retailer Borders Group (BGP) and David Einhorn-controlled reinsurer Greenlight Capital Re (Nasdaq: GLRE). Meanwhile, credit card company Visa (V) and fast food firm Wendy’s Arby’s Group (WEN) disappeared from the Pershing portfolio.

At tickerspy.com, members can track Pershing’s latest holdings, see a graph of their combined performance, and be notified when new holdings are made public.

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Tags: ADP, BGP, EMC, GLRE, MCD, TGT, V, WEN