Investing in Bill Ackman stocks ranks among the top picks on the stock market today.
Founded over two decades ago, stock picks from Ackman’s Pershing Square hedge fund have become a key talking point among value investors. He embraces maverick investor Warren Buffett’s time-honored principle that “Diversification is protection against ignorance.”
Hence, Ackman operates a tightly focused portfolio. By the end of the first quarter, his portfolio was concentrated around just six companies, with assets worth upwards of $9 billion. His audacious yet calculated bets underscore his deep understanding of stock market investing.
Let’s look at three of the best Bill Ackman stocks, which will continue delivering the goods for the foreseeable future. These stocks have surged impressively this year and are poised to maintain their superb performance ahead of the first rate cut. Additionally, their core businesses feature robust fundamentals and are expected to continue growing rapidly.
Chipotle Mexican Grill (CMG)
Chipotle Mexican Grill (NYSE:CMG) comfortably clinches the top spot as the best-performing stock in Ackman’s portfolio this year. The restaurant chain’s shares jumped more than 38% last year and are up 26% year-to-date (YTD). Despite Pershing Square trimming its stake in CMG stock by 9.8% in Q1, it still constitutes over 20% of its portfolio.
Before its massive 50-to-1 stock split on June 25, CMG reached an eye-catching peak of $3,200 per share. The move effectively renders the stock more accessible and appealing to retail investors, proving to be a great decision overall.
On the financial front, Chipotle continues to deliver goods to its shareholders. It reported a healthy 14.1% year-over-year (YOY) revenue increase and a 23.2% jump in net income for Q1. Moreover, the firm also launched 47 new locations, staying on track to open 285-315 restaurants this year. Furthermore, comparable restaurant sales grew by 7% on a YOY basis, highlighting Chipotle’s enduring appeal.
Hilton Worldwide (HLT)
Hilton Worldwide (NYSE:HLT) is a bellwether in the hotel industry, efficiently blending comfort with upscale locations to cater to its massive customer base. Like CMG, HLT stock remains a cornerstone in Ackman’s portfolio, accounting for 26.9% of Pershing’s portfolio. Additionally, HLT stock surged over 45% last year, underscoring the robust investor confidence in its stock.
Furthermore, Hilton has consistently posted double-digit top-line growth across multiple quarters post-pandemic. The latest chapter in its ongoing growth saga is shown in its impressive Q1 results, where it blew past analyst earnings expectations while boosting its full-year outlook. Revenue surged 12.2% YOY to $2.57 billion, while its EPS climbed to $1.53, beating estimates by 11 cents.
These superb results are linked to Hilton’s adept management, which has fine-tuned its operations to adapt to evolving market trends. Moreover, its robust business model and ability to attract and retain guests underscores its leadership position in its niche.
Canadian Pacific Kansas City (CP)
Canadian Pacific Kansas City (NYSE:CP) is a stalwart in the railroad industry, which makes up approximately 16.7% of Ackman’s portfolio. Rail transport remains one of the most cost-effective methods for bulk transportation, and its extensive railway infrastructure is tough to replicate due to multiple barriers to entry.
Furthermore, CP boasts an impressive economic moat, solidifying its position as a leading contender in the North American region. It struts an expansive network spanning roughly 20,000 route miles across Canada and the United States, fortifying its enviable positioning.
Recently, the company has capitalized on the nearshoring trend as businesses strategically bolster their supply chains closer to their operations. This strategic shift has led to significant contract wins for CP, leading to double-digit revenue growth in recent quarters. Moreover, this superb trajectory underscores the company’s critical role in redefining supply chain dynamics with significant potential for sustained long-term growth.
On the date of publication, Muslim Farooque did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.