Ackman's Pershing Square unveils $900 million stake in Starbucks



The funding runs Pershing square has invested nine hundred million dollars in Starbucks and ackman Noche ranking violet. He said that he expects shares of Starbucks to double in the next three years. I will just say, from my standpoint. This is the single biggest holding I have in my portfolio is Starbucks and I do not view this as welcome news. I just I saw this, it's the curse. It's not even. It's not even so much the curse, but I just sort of thought, you know what? I don't need that right now, and I'm not. I don't even work at Starbucks, but I just thought if your Starbucks management of your Starbucks board. You're looking at Bill ackman saying, well, I'm here. I've got some ideas. Let me share with you. The wisdom that I shared with the people at Cipolla took steak there and Burger King, and you know, I don't want to dump all over Afrin. Even though I just have many because the guy has had some success. But this this just seems like ultimately more of a distraction for Starbucks management than anything. Positive. I agree. I think Starbucks is a business. I'm not. I mean, I'm sure this is. I mean, he's he's in investing in less or a little over one percent of the shares. I gotta feel this got to be a passive investment. I mean, I don't know what value he thinks he can add. I mean, in my mind, Starbucks is a business that has a pretty clear trajectory. There's not really a lot wrong with the business. I know growth has been slower for this isn't a business where I think ackman's coming in saying, oh, here's a problem, or here's something that's undervalued that I think I can create value or add to. And again, I. I don't know why we have to keep talking about Bill ackman. He's definitely a newsmaker, but you start you start telling up the MRs here over the last decade starting with target herbalife and then value pharmaceutical, which was multi billion dollars. I mean, the JC Penney. Right. I mean, it just the list is building here, and so I share your discomfort as a Starbucks shoulder as well. I'm not sure what Bill ackman actually brings to the table anymore. I think he's just looking for an easy win. Frankly, I think given the stretch that he's had and you just listed off some of his Villier failures that will in all of them. I mean, he's had a really tough gov lately, and and I think frankly, he's just looking for an easy win and we were talking about this yesterday. I think it's easy enough to get out there and make fun of ackman for picking Starbucks. Oh, it's no big secret. Everybody knows what Starbucks is, but that's kind of the point to really. And I think we talked about this a lot that really at the end of the day, those great businesses, they're not secrets. They're out there right in front of us since. I mean, he, he in the reasoning behind this. I mean, he listed off a lot of qualities that really we like. The business end. So for me, I mean, I don't think he's going to go there and try to turn things around or shape their strategy whatsoever because he certainly has a history of seeming to think he knows more than he really does in Starbucks is obviously very big company. Obviously, with with management, they're already said on a strategy, I guarantee you, they know more about the business and its future markets than he ever will. So yet to me, I really just think he's looking for an easy win here in that can't blame him. Starbucks is is a is a good business. That's when we like a lot here, and I think that you can hang onto a free longer than three years. Then you'd be better off. You think a doubles, like totally route I would love. I would love to be sitting here three years doing this show talking about how wrong I was to doubt Bill ackman that Starbucks shares had doubled in a three year period. It's such a mature business at this point. As you said, Mattie, the trajectory for Starbucks is pretty clear. If I the bet I'm betting it's higher in three years, but dub. It's a seventy seven billion dollar company. Yeah, I think to me, Starbucks is more of a a total return story. You're looking at dividends looking to buy backs. You're looking at a little bit of growth on the top line. You're looking at what they can do in China. But yeah, double in three years again to for that to happen, there has to be the dreaded financial engineering or something like that. That kind of does that. And you know, acting kind of does bring that to the table. I hope that's not the case to me. Starbucks, steady, ten percent, return her business. Certainly not a double in three years. I'd love to see it, but I think it's also worth remembering too. I mean, Starbucks is probably a witness a little bit more on the expense line there as a pertains to employ ease because they continue to revamp the benefits that they offer. I mean, just a recent example here was was the childcare subsidy, and I think they're, they're expanding that they're expanding that offering to every employee in the company. So I mean as an investor, I think you have to applaud that as a as an employee. I'm sure you'll love that it does it. Perhaps tamp down potential returns in the short run. Yep. Is that the right. Thing to do? Yeah. I think longer term it gives the company more opportunity to succeed to grow in. So those are good things, but we'll definitely play into that returns projection over the course of the next three years. I mean, fifteen percent annualized over the next three years or well, no, you're seeing double over the. Twenty percent. Yeah. Fifteen would be five years that seemed like a really hot hurdle very hurdle. You mentioned financial engineering. I'll just say this. I've never sold a single share of Starbucks in all the years. I've owned it if Eddie Lampert joins the

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