Bill Ackman Is Having His Best Year Ever; Another day, another troll; Reader feedback on discussing politics civilly and on Tesla; Stansberry Conference

By Whitney Tilson

Tuesday, July 9, 2019

1) In my March 22 e-mail, I wrote about my college buddy Bill Ackman and how undervalued his publicly traded vehicle, Pershing Square (PSHZF), is. Now Barron’s has picked up the story: Bill Ackman Is Having His Best Year Ever. So Why Are Investors Ignoring His Fund? Excerpt:

At age 53, the activist investor Bill Ackman is having the best year of his career. And for those who want to invest alongside him, there is now an opportunity to get in at a big discount.

Ackman’s closed-end fund, Pershing Square Holdings, closed Tuesday at $17.90 a share, a 28% discount to its net asset value of $24.92 on June 30.

The fund’s NAV was up 45.3% in the first half of this year, more than double the S&P 500’s 19.6% return and one of the best showings among any sizable equity-oriented fund…

Ackman called the fund “an anomaly” because it invests primarily in U.S. stocks but is listed in Europe. That structure limits the fund’s ability to “engage with U.S. investors. As a result, a large source of potential demand for PSH stock is largely unaware of the existence of the company.”

He added that “we own one of the highest quality collections of businesses that we have owned since the inception of Pershing Square” in 2004. He added that the firm is returning to its roots “as an investment-centric operation rather than an asset management business with the attendant requirements to continually raise capital.”…

The fund amounts to a discounted way to play a resurgent Ackman and his concentrated equity portfolio with a potential bonus if the stubbornly wide discount ever closes.

2) Another day, another troll… Dr. Gary O. writes:

Looks like Tesla met their production quota. Not exactly what you predicted. The final straw was that you voted for Booker and “met” with Obama. Sounds like you are a dumbocrat to me. Kind of on a ego trip also. All these pictures and athletic accomplishments. Not exactly what I want from a financial advisor.

Again, though I welcome contrary viewpoints, I don’t dignify petty comments with a personal reply. But here’s a public one:

Mark my words, whether Tesla (TSLA) hits my year-end price target of $100 or not, I’ll be proven right on it and my readers will thank me for warning them away from it – or getting them into it on the short side (see the e-mail from a subscriber, below) at $295.

As for sharing certain aspects of my life, I’ve been spicing up my investing e-mails in this way since I first started writing them 20 years ago. I think it makes them more interesting, unique, and personal. I get an overwhelming positive response – and so many great things come of it. Just by mentioning that I was going to Wimbledon, Vitaliy (from yesterday’s e-mail) connected me with a friend who sold me reasonably priced tickets and another subscriber whose house abuts the tennis center held my bag for the day and hosted me for a drink before I had to run to catch my flight to Lyon. In addition to the tangible benefits, I feel like I have two new friends who I’ll surely see again…

For those who don’t care for it and wish I’d just stick to stocks/investing, I always put this kind of thing at the end of my e-mails, so it’s easy to ignore… and there’s always the unsubscribe button.

3) Thankfully, almost all of the folks who disagree with me do so respectfully, as lifetime Empire Financial Research subscriber Otto K. does here:

I must admit that my political ideation leans more toward Porter than to you, but I can appreciate at least some of the points you make, and the opinions you hold. Perhaps even more, I appreciate that you and Porter can discuss politics civilly with each other and remain friends. After all, it was Porter who gave you the publicity and opportunity to spread the word about your new Empire Financial venture, of which I am a lifetime member.

If only at least the greater majority of politicians, editorial writers, and less-than-unbiased “news” reporters could maintain the same civil attitudes, and the willingness to consider each other’s opinions without rejecting them out-of-hand, we could perhaps not only have a wider civility in our nation’s political discussion, but also discover and implement more solutions to our problems that at least promise to be workable.

Reader Alex M. does the same here:

Thanks for your newsletter and for the recommendation to read Guy Spier’s book. It was excellent.

I strongly agree with Porter on this one. My family is from the USSR and I can tell you personally that the government telling people what they can or cannot say will lead to jail cells, detention centers and the gulag. It always starts with a noble goal but ends in the raw exercise of power by bureaucrats suppressing information that the government doesn’t want you to see.

If you think this is an exaggeration, take a look at what is happening in China right now.

I’ll take my wild and lawless Facebook and rely on human intelligence to weed out the lies from the truth. That’s what freedom means to me.

4) Sometimes I get great e-mails like this one, in response to last Friday’s e-mail about Tesla. One of my subscribers, Neil S., wrote:

We met at your dinner in Omaha. I talked with your analyst, Steve Culbertson, at some length, and I subscribe to the newsletter. I couldn’t resist responding on the “troll” on Tesla and your point about taking responsibility for your own trades.

When I first saw mention of your TSLA short at the same time as the launch of your newsletter, I thought it was a great trade, supported by the chart, and I bought puts. That first week, I made about $10,000, took some profits Friday afternoon, and decided I’d spend some of it going to Omaha at the last minute. I re-entered the short side but with a spread, closed out the long puts as it bottomed, held the short puts for a small gain, then got out, and re-entered a third time to the very bottom, then closed out the trade on the confirmed bounce that turned into this long run-up. In all, I made something more than $30,000. I wouldn’t have started that trade except for your letter.

I’m not trying to say I’m a brilliant trader. I don’t do a lot of shorting. I just know that nothing goes straight up or straight down, and I’ve seen the bursts of enthusiasm for J.C. Penney and Sears and others. I didn’t take your thesis to suggest there would be no wave cycles. I’ll probably short TSLA again, and your short thesis makes a lot of sense to me – but I won’t short till the chart tells me, and then for only as long as that new downtrend remains in place.

All the best on your vacation.

5) I attended – and spoke at – my first Stansberry Research Conference last October. It was a great event – three days of top speakers (including Porter Stansberry, Steve Sjuggerud, and Doc Eifrig), good investment ideas, and fun networking. So I’m really looking forward to attending – and again speaking at – this year’s event, which will take place from Monday, October 7 through Wednesday, October 9 at the beautiful Aria Resort & Casino in Las Vegas, Nevada.

Stansberry is offering a special deal to my readers, which you can access here. Get your tickets now. They’re going fast, and sales will close in a few weeks!

Best regards,


Whitney Tilson

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About Whitney Tilson

Prior to creating Empire Financial Research, Whitney Tilson founded and ran Kase Capital Management, which managed three value-oriented hedge funds and two mutual funds. Starting out of his bedroom with only $1 million, Tilson grew assets under management to nearly $200 million.

Tilson graduated magna cum laude from Harvard College with a bachelor’s degree in government in 1989. After college, he helped Wendy Kopp launch Teach for America and then spent two years as a consultant at the Boston Consulting Group. He earned his MBA from Harvard Business School in 1994, where he graduated in the top 5% of his class and was named a Baker Scholar.

Click here for the full bio.