Over the last few years Ackman has been a mainstay in financial news for his concentrated bets and loud public voice. He launched a multi-billion dollar fund that invested in one stock (Target). He is one of the most well-known activist investors in the business. (Ackman is an activist for his own hedge fund, not for anything noble or worthwhile.)
Ackman was in the news this week because he promised the “presentation of his life” about Herbalife (HLF), a stock he has been short for nearly two years. This announcement alone drove the stock down 11% on Monday. After actually finishing his “bombshell presentation” Tuesday, Herbalife responded by rising nearly 25% by the end of the day. I think this proves once and for all how efficient the market can be. Bill’s power point presentation lasted nearly 3 hours- after recently sitting through the movie Boyhood I cant attest that 3 hours is TOO LONG. If you need 3 hours to make your compelling case about a stock, you’ve gone too far down the rabbit hole. In fact, if you can’t tell someone your pitch in 5 minutes it’s likely you are too far up your own ass for any stock idea.
Over the last few years there has been a rebirth of “activist investors,” a title that used to signify shareholders fighting for value for other shareholders over incumbent management that was doing a poor job. Success as an activist has led Ackman and Einhorn to become kings of self-promotion. Today activism appears to be a code word for pumping your own positions.
I figure with our follower count approaching 30’s (in 3 continents no less), ATG is reaching that level where some self-promotion could help move the market in our favor. I’ll have to work on a fancy slide presentation. But next week expect some bombshell news about one of our positions. Or maybe a new positions, it depends on what graphics I think fit the stock choice the best.