Ackman Overhauls Portfolio, Adds Netflix, Visa, and Mastercard

Pershing Square Capital Management's portfolio has undergone its largest overhaul in years, according to recent filings. The fund's founder and CEO, Bill Ackman, made significant changes to his investment strategy, adding Netflix, Visa, and Mastercard to the lineup.

The Pershing Square fund has averaged annual gains of around 16%, significantly outperforming the overall stock market's average of 11%. This impressive track record is reflected in the concentrated portfolio, with only 14 holdings as of June 30. The addition of Netflix, Visa, and Mastercard marks a shift towards dominant companies that are poised to continue growing.

The thesis behind these new additions appears to be centered around valuation, with Ackman seeking out stocks at fair or low prices. Netflix shares have dropped by about 32% over the past year due to slowing growth and increased competition, but its price-to-earnings ratio remains relatively low at 26. Visa and Mastercard shares also seem fairly valued, considering their recent P/E ratios of 33, close to their five-year averages.