Pershing Square (LON:PSH) used its annual investor meeting to outline portfolio performance, governance priorities, and several strategic initiatives, including an ongoing restructuring of its planned U.S. vehicle and a major new phase in the evolution of long-held holding Howard Hughes.
Leadership update and board remarks
Chief Investment Officer Ryan Israel opened the meeting noting that founder Bill Ackman was absent due to a family medical emergency. Ackman later joined virtually for the Q&A and said a family member had suffered a stroke.
2025 performance, capital structure, and discount management
Morley said PSH delivered strong results in 2025, with net asset value (NAV) rising 20.9%. With discount narrowing, total shareholder return was 33.9%. He added that over the last eight years, compound growth in both NAV and share price has been 23%, which he compared with 14% for the S&P 500 and 7% for the FTSE over the same period.
Morley highlighted PSH’s use of long-term, laddered debt out to 2039, supported by what he described as a liquid, easy-to-value portfolio that results in low borrowing rates. He reported a weighted average maturity of six years and a weighted average cost of capital of 3.6%, with a debt-to-total-capital ratio managed between 15% and 25%. In 2025, PSH issued two bonds: a €650 million five-year bond at 4.25% and a $500 million seven-year bond at 5.5%. He also said credit ratings improved, with Fitch upgrading to BBB+ and S&P to A-.
On discount to NAV, Morley said the board uses multiple tools:
- A dividend policy initiated in 2019 and amended in 2022 so that the dividend increases automatically with NAV; Morley said the dividend has increased 86% since the amendment and PSH has paid $666 million in dividends.
- Share repurchases when viewed as the best use of capital; Morley said PSH bought back 6.6 million shares for about $370 million in 2025, bringing total buybacks to $1.8 billion and reducing shares outstanding by just under 30% versus the original share count.
- Marketing and distribution initiatives outside the U.S., including work with Cadarn and LodeRock.
Morley said the discount narrowed by seven points in 2025, from 31% to 24%, but reiterated the board’s view that the most powerful driver of long-term returns is “continued strong absolute and relative NAV performance.”
Strategic initiatives: PSUS redesign and Howard Hughes transformation
Israel said PSH continued work in 2025 to redesign the structure of “PSUS,” following investor feedback after a marketing phase in summer 2024. He said he was not permitted to share further details or take questions on the topic, but stated that launching PSUS would “materially reduce” the performance fees paid by PSH via an offset arrangement tied to management fees earned in future vehicles.
A central focus of the meeting was Howard Hughes, a holding PSH has owned for nearly 15 years. Israel said the investment had underperformed expectations as a stock despite progress in underlying real estate assets. He said Pershing Square concluded Howard Hughes should be transformed into a diversified holding company “in the spirit of Berkshire Hathaway.”
Israel said Pershing Square’s management company invested $900 million into Howard Hughes in May, buying 9 million shares at $100. He said Howard Hughes will pursue control transactions (51% to 100% ownership) over time, while PSH will continue minority investments in publicly traded companies.
As part of the transformation, Ackman rejoined the board as executive chairman and Israel became the company’s CIO. Israel also said the Pershing Square team is being made available to Howard Hughes in exchange for management fees, with PSH’s management fees reduced dollar-for-dollar by PSH’s proportionate share of fees received from Howard Hughes related to PSH’s ownership.
Vantage acquisition and PSH preferred investment
Israel said Howard Hughes’ first major step is the planned acquisition of Vantage, a specialty insurer and reinsurer, for about $2.1 billion, described as roughly 1.5x year-end 2025 book value. He said Pershing Square expects the effective multiple at close to be lower (potentially below 1.4x) because of an agreement allowing it to benefit from book value growth between year-end and closing, along with net income generated. He said closing is expected at the end of the second quarter, “in June.”
Israel said $1.2 billion of the purchase price comes from Howard Hughes, with a significant portion tied to cash from the May capital raise. He also said PSH committed in December to provide up to $1 billion as a backstop minority investment via newly issued, non-interest-bearing Howard Hughes preferred stock. Israel described the preferred as split into 14 tranches redeemable annually, with redemption pricing set at 1.5x Vantage’s then-current book value. If not redeemed by seven years, the preferred would convert into Vantage common stock; Israel said he viewed that as unlikely and expected excess cash flow from Howard Hughes’ real estate business could repurchase the preferred within roughly three years.
In the Q&A, Ackman said a large share of Vantage’s long-term value would come from asset management, describing an intent to invest float conservatively and invest a substantial portion of insurer surplus in common stocks over time. He added that Pershing Square would not charge Vantage for asset management, which he said would provide a competitive advantage.
Portfolio activity, hires, and market perspective
Israel said PSH made three new investments in 2025—Hertz, Amazon, and Meta (disclosed for the first time as initiated in late November)—and exited Chipotle, Canadian Pacific, and Nike during the year, with Hilton fully exited in the weeks prior to the meeting. He described Hertz as a small “asymmetric” position with potential upside if a turnaround succeeds.
Israel also discussed organizational updates, including the hire of investment team member Jordan Aguiar-Lucander, corporate investor relations head Jill Chapman, and general counsel Lucas Richards, along with the departure of investor Manning Feng.
On market conditions, Israel argued that much of the S&P 500’s post-COVID advance has been driven by earnings growth rather than multiple expansion, and said a small group of large companies is driving a significant share of forecast earnings growth. He and Ackman emphasized that PSH’s ability to move quickly into mega-cap stocks during periods of volatility has become more important, citing Alphabet, Amazon, and Meta as examples of “narrative-driven” dislocations that created entry points.
About Pershing Square (LON:PSH)
Pershing Square Holdings (LN:PSHD) is an investment holding company structured as a closed-ended fund that makes concentrated investments in publicly traded, principally North American-domiciled, companies. The investment objective is to maximize long-term compound annual rate of growth in intrinsic value per share.
