Billionaire investor Bill Ackman revealed Thursday that his hedge fund, Pershing Square Capital Management, bought shares of Amazon last month. The investment reflects Ackman’s belief that the company’s earnings will continue to rise, as U.S. tariffs under President Donald Trump proved less severe than expected.
Amazon Now Pershing Square’s Most Significant New Holding
During a client call, Chief Investment Officer Ryan Israel described the Amazon investment as the firm’s “most significant move.” Amazon, with a market capitalization exceeding $2 trillion, has long been one of Ackman’s most admired companies.
Ackman, known for his activist investing style, rarely adds tech giants to his portfolio. But after Amazon’s stock fell sharply in early April due to fears over Trump’s tariffs, the hedge fund saw an opportunity.
“We believe the company can overcome any slowdown in Amazon Web Services,” said Israel. “And we don’t expect the tariffs to materially affect retail earnings.”
Confidence in CEO Andrew Jassy’s Leadership
Ackman and his team also expressed strong confidence in Amazon CEO Andrew Jassy. They believe he can boost operational efficiency, enabling the company to expand margins while maintaining high revenue growth.
Portfolio Rebalancing: New Stakes in Hertz and Uber
To fund the Amazon investment, Pershing Square reshuffled its portfolio. The hedge fund added new positions in Hertz, the car rental company, and Uber, the transportation firm.
At the same time, it sold its stake in Canadian Pacific Railway, one of Ackman’s most profitable past investments. “We regret selling,” Ackman admitted, citing his high regard for the company’s leadership and future potential.
Canadian Pacific has benefited from trends such as re-shoring manufacturing to North America and initiatives to reduce carbon emissions, making the exit a tough decision. However, Ackman noted that reallocating capital to Amazon required “difficult but strategic trade-offs.”
Reducing Exposure to Chipotle, Hilton, and Universal Music
The hedge fund also cut back on positions in Chipotle Mexican Grill, Hilton Worldwide Holdings, and Universal Music Group. Additionally, it replaced its Nike shares with call options, which Ackman’s team described as a “deep in-the-money strategy,” giving them similar exposure with greater capital flexibility.
