Jefferies Initiates Coverage on Pershing Square with Buy and Hold Ratings
Written by Emily J. Thompson, Senior Investment Analyst
Updated: May 25 2026
0mins
Source: seekingalpha
- Coverage Initiation: Jefferies has initiated coverage on Pershing Square USA (PSUS) with a Buy rating and Pershing Square Inc. (PS) with a Hold recommendation, as analyst Matthew Hose believes PSUS will benefit from a strong performance track record and attractive valuation.
- Performance Comparison: PSUS is expected to mirror the performance of other Pershing Square core funds, which have outperformed the S&P 500 over the long term, despite PSUS losing approximately 17% from its IPO price, closing at $41.30 last Friday.
- Investment Outlook: Jefferies sees PSUS's long-term net returns bolstered by the absence of a performance fee, improvement in net asset value after full investment of the portfolio, and increased liquidity, while the fund's strong marketability due to its manager and portfolio adds to its appeal.
- Capital Structure Analysis: Jefferies rates PS as Hold with a $40 price target, noting that analyst Daniel Fannon highlights the firm's capital base as structurally different from other traditional and alternative asset managers, with about 96% of its fee-paying capital classified as permanent, indicating a balanced risk/reward profile.
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Analyst Views on PSUS
Wall Street analysts forecast PSUS stock price to rise
0 Analyst Rating
0 Buy
0 Hold
0 Sell
Current: 38.060
Low
Averages
High
Current: 38.060
Low
Averages
High
About PSUS
Pershing Square USA, Ltd. (the Fund) is a non-diversified, closed-end investment company. It is designed primarily for long-term investors and is not intended to be a trading vehicle. The Fund's investment objective is to preserve capital and seek maximum, long-term capital appreciation commensurate with reasonable risk. The Fund shall seek to achieve its investment objective by investing principally in common stocks that Pershing Square Capital Management, L.P., a Delaware limited partnership (the Adviser), believes exhibit significant valuation discrepancies between current trading prices and intrinsic business (or net asset) value, often with a catalyst for value recognition. The Adviser expects that the substantial majority of the Fund's investment portfolio shall be invested in 12 to 15 core long-term holdings in large-capitalization, investment grade, free-cash-flow-generative North American durable growth companies. The Fund has no operations.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
Bruce Herring Increases Stake in PSUS Shares
- PSUS Stake Increase: Bruce Herring purchased 5,000 shares of PSUS on Wednesday at $40.25 each, totaling an investment of $201,250, indicating confidence in the company's future prospects.
- Market Price Comparison: PSUS is currently trading below Herring's purchase price, with a low of $39.30 on Monday, which is 2.4% under his buying price, reflecting a cautious market sentiment towards the stock.
- Historical Purchase Record: Prior to this latest buy, Herring had purchased 434,140 shares at an average price of $43.41 each over the past year, demonstrating his ongoing interest and investment commitment to PSUS.
- WhiteHorse Finance Investment: Director John Bolduc bought 15,380 shares of WhiteHorse Finance on Thursday at $6.49 each, totaling $99,816, showcasing confidence in the company despite an average purchase price of $6.96 in previous transactions.
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Bill Ackman Launches $5 Billion Fund for U.S. Investors
- New Fund Launch: Bill Ackman launched a $5 billion closed-end fund, Pershing Square USA, in April, benefiting from permanent capital that allows for a focus on long-term investment decisions, enhancing flexibility and strategic depth in his investment approach.
- Portfolio Transparency: Ackman disclosed that Pershing Square USA has purchased eight out of twelve stocks since its IPO, indicating a high overlap with his previous fund, Pershing Square Holdings, which reflects consistency in his investment strategy and keen market opportunity recognition.
- Market Opportunity Identification: Ackman highlighted that tech giants like Amazon, Microsoft, and Meta are undervalued in the current market, despite strong performances from semiconductor and neo-cloud companies, suggesting significant buying opportunities that could yield substantial returns for investors.
- Management Fee Consideration: The new fund charges a 2% annual management fee, which, while not excessive, necessitates careful evaluation by investors as most active funds fail to outperform the market after fees, raising concerns about the fund's overall investment value and potential risks.
See More
Ackman Launches New Fund Pershing Square USA with $5 Billion
- Fund Launch: Ackman launched the closed-end fund Pershing Square USA in April, raising $5 billion and investing 85% of the capital within seven weeks, demonstrating his commitment to long-term investment strategies.
- Portfolio Overlap: The new fund's portfolio significantly overlaps with his other publicly traded fund, Pershing Square Holdings, with eight out of twelve disclosed stocks being long-term holdings, indicating Ackman's continued confidence in these companies.
- Market Opportunities: Ackman highlighted that tech giants like Amazon, Microsoft, and Meta are undervalued in the current market, suggesting significant upside potential for these stocks, especially as investors focus on emerging tech companies.
- Management Fee Consideration: With a 2% annual management fee and a 5% decline in net asset value since its IPO, Pershing Square USA presents a potential entry point for patient investors who align with Ackman's long-term investment approach.
See More
Ackman's Pershing Square Adds New Investments
- Portfolio Expansion: Bill Ackman's Pershing Square USA (PSUS) added four new companies in the past six weeks, indicating a continued focus on high-quality durable growth firms, with these new holdings set to be disclosed in the upcoming Q2 report.
- Capital Deployment: Since its IPO on April 29, PSUS has deployed nearly 85% of its capital across 12 companies, including Amazon, Microsoft, and Uber, demonstrating its proactive positioning in the market and confidence in future growth prospects.
- Stock Performance: PSUS rose 4.8% in Monday's regular trading, although it is currently trading at a ~20% discount to its net asset value, reflecting short-term technical factors post-IPO, which are expected to moderate over time.
- Management Confidence: Ackman and his management team acquired over 10 million shares of PSUS, investing more than $500 million during the IPO and in the market afterward, showcasing strong confidence in the company's future performance and further bolstering market trust in PSUS.
See More
High Yield Potential of CEF Investments
- High Yield Appeal: The average yield of CEFs stands at 8.7%, while the CEF Insider portfolio yields 9.1%, significantly reducing the savings needed for investors to generate $100,000 in annual income, highlighting CEFs' advantages in income generation.
- Liberty All-Star Equity Fund Performance: The Liberty All-Star Equity Fund (USA) offers a 10.4% yield and has achieved an annualized return of 11.7% over the past decade, with dividends increasing by 25% during this period, making it an attractive option for income-focused investors.
- PSUS's Poor Market Performance: Despite raising $5 billion under the management of renowned investor Bill Ackman, the Pershing Square USA (PSUS) has seen a 24% decline in market price return since its launch, indicating the negative impact of its lack of dividends and oversized scale on performance.
- Building Monthly Income Streams: The top five recommended monthly dividend CEFs yield an average of 9.7%, translating to $9,700 in dividends on a $100,000 investment, showcasing CEFs' potential in providing stable cash flow.
See More
Jefferies Initiates Coverage on Pershing Square with Buy and Hold Ratings
- Coverage Initiation: Jefferies has initiated coverage on Pershing Square USA (PSUS) with a Buy rating and Pershing Square Inc. (PS) with a Hold recommendation, as analyst Matthew Hose believes PSUS will benefit from a strong performance track record and attractive valuation.
- Performance Comparison: PSUS is expected to mirror the performance of other Pershing Square core funds, which have outperformed the S&P 500 over the long term, despite PSUS losing approximately 17% from its IPO price, closing at $41.30 last Friday.
- Investment Outlook: Jefferies sees PSUS's long-term net returns bolstered by the absence of a performance fee, improvement in net asset value after full investment of the portfolio, and increased liquidity, while the fund's strong marketability due to its manager and portfolio adds to its appeal.
- Capital Structure Analysis: Jefferies rates PS as Hold with a $40 price target, noting that analyst Daniel Fannon highlights the firm's capital base as structurally different from other traditional and alternative asset managers, with about 96% of its fee-paying capital classified as permanent, indicating a balanced risk/reward profile.
See More
Bruce Herring Increases Stake in PSUS Shares
- PSUS Stake Increase: Bruce Herring purchased 5,000 shares of PSUS on Wednesday at $40.25 each, totaling an investment of $201,250, indicating confidence in the company's future prospects.
- Market Price Comparison: PSUS is currently trading below Herring's purchase price, with a low of $39.30 on Monday, which is 2.4% under his buying price, reflecting a cautious market sentiment towards the stock.
- Historical Purchase Record: Prior to this latest buy, Herring had purchased 434,140 shares at an average price of $43.41 each over the past year, demonstrating his ongoing interest and investment commitment to PSUS.
- WhiteHorse Finance Investment: Director John Bolduc bought 15,380 shares of WhiteHorse Finance on Thursday at $6.49 each, totaling $99,816, showcasing confidence in the company despite an average purchase price of $6.96 in previous transactions.
See More
Bill Ackman Launches $5 Billion Fund for U.S. Investors
- New Fund Launch: Bill Ackman launched a $5 billion closed-end fund, Pershing Square USA, in April, benefiting from permanent capital that allows for a focus on long-term investment decisions, enhancing flexibility and strategic depth in his investment approach.
- Portfolio Transparency: Ackman disclosed that Pershing Square USA has purchased eight out of twelve stocks since its IPO, indicating a high overlap with his previous fund, Pershing Square Holdings, which reflects consistency in his investment strategy and keen market opportunity recognition.
- Market Opportunity Identification: Ackman highlighted that tech giants like Amazon, Microsoft, and Meta are undervalued in the current market, despite strong performances from semiconductor and neo-cloud companies, suggesting significant buying opportunities that could yield substantial returns for investors.
- Management Fee Consideration: The new fund charges a 2% annual management fee, which, while not excessive, necessitates careful evaluation by investors as most active funds fail to outperform the market after fees, raising concerns about the fund's overall investment value and potential risks.
See More
Ackman Launches New Fund Pershing Square USA with $5 Billion
- Fund Launch: Ackman launched the closed-end fund Pershing Square USA in April, raising $5 billion and investing 85% of the capital within seven weeks, demonstrating his commitment to long-term investment strategies.
- Portfolio Overlap: The new fund's portfolio significantly overlaps with his other publicly traded fund, Pershing Square Holdings, with eight out of twelve disclosed stocks being long-term holdings, indicating Ackman's continued confidence in these companies.
- Market Opportunities: Ackman highlighted that tech giants like Amazon, Microsoft, and Meta are undervalued in the current market, suggesting significant upside potential for these stocks, especially as investors focus on emerging tech companies.
- Management Fee Consideration: With a 2% annual management fee and a 5% decline in net asset value since its IPO, Pershing Square USA presents a potential entry point for patient investors who align with Ackman's long-term investment approach.
See More
Ackman's Pershing Square Adds New Investments
- Portfolio Expansion: Bill Ackman's Pershing Square USA (PSUS) added four new companies in the past six weeks, indicating a continued focus on high-quality durable growth firms, with these new holdings set to be disclosed in the upcoming Q2 report.
- Capital Deployment: Since its IPO on April 29, PSUS has deployed nearly 85% of its capital across 12 companies, including Amazon, Microsoft, and Uber, demonstrating its proactive positioning in the market and confidence in future growth prospects.
- Stock Performance: PSUS rose 4.8% in Monday's regular trading, although it is currently trading at a ~20% discount to its net asset value, reflecting short-term technical factors post-IPO, which are expected to moderate over time.
- Management Confidence: Ackman and his management team acquired over 10 million shares of PSUS, investing more than $500 million during the IPO and in the market afterward, showcasing strong confidence in the company's future performance and further bolstering market trust in PSUS.
See More
High Yield Potential of CEF Investments
- High Yield Appeal: The average yield of CEFs stands at 8.7%, while the CEF Insider portfolio yields 9.1%, significantly reducing the savings needed for investors to generate $100,000 in annual income, highlighting CEFs' advantages in income generation.
- Liberty All-Star Equity Fund Performance: The Liberty All-Star Equity Fund (USA) offers a 10.4% yield and has achieved an annualized return of 11.7% over the past decade, with dividends increasing by 25% during this period, making it an attractive option for income-focused investors.
- PSUS's Poor Market Performance: Despite raising $5 billion under the management of renowned investor Bill Ackman, the Pershing Square USA (PSUS) has seen a 24% decline in market price return since its launch, indicating the negative impact of its lack of dividends and oversized scale on performance.
- Building Monthly Income Streams: The top five recommended monthly dividend CEFs yield an average of 9.7%, translating to $9,700 in dividends on a $100,000 investment, showcasing CEFs' potential in providing stable cash flow.
See More
Jefferies Initiates Coverage on Pershing Square with Buy and Hold Ratings
- Coverage Initiation: Jefferies has initiated coverage on Pershing Square USA (PSUS) with a Buy rating and Pershing Square Inc. (PS) with a Hold recommendation, as analyst Matthew Hose believes PSUS will benefit from a strong performance track record and attractive valuation.
- Performance Comparison: PSUS is expected to mirror the performance of other Pershing Square core funds, which have outperformed the S&P 500 over the long term, despite PSUS losing approximately 17% from its IPO price, closing at $41.30 last Friday.
- Investment Outlook: Jefferies sees PSUS's long-term net returns bolstered by the absence of a performance fee, improvement in net asset value after full investment of the portfolio, and increased liquidity, while the fund's strong marketability due to its manager and portfolio adds to its appeal.
- Capital Structure Analysis: Jefferies rates PS as Hold with a $40 price target, noting that analyst Daniel Fannon highlights the firm's capital base as structurally different from other traditional and alternative asset managers, with about 96% of its fee-paying capital classified as permanent, indicating a balanced risk/reward profile.
See More
