The Motley Foolยท2025-05-22 08:43Core Insights - Investors closely monitor the trades of billionaire hedge fund managers, as hedge funds provide quarterly updates and file 13F reports detailing their trades [1] Group 1: Pershing Square Capital and Nike - Bill Ackman's Pershing Square Capital sold its position in Nike, which previously accounted for about 11% of its total portfolio, making it the sixth-largest position [4] - Ackman cited three main reasons for selling Nike: a shift to direct-to-consumer strategy harming wholesale partnerships, a merchandising structure that neglected sports, and overproduction of popular franchises instead of focusing on innovation [5] - Despite selling, Ackman converted Nike investments into call options, allowing for potential gains while minimizing losses, believing that a successful turnaround could yield returns more than double that of owning common stock [6] Group 2: Nike's Current Performance - Nike's sales were down 9% year-over-year in the fiscal 2025 third quarter, with a 12% drop in direct-to-consumer channels contributing to a 3.3 percentage-point decrease in gross margin [7][8] - Ackman's strategy indicates a belief that Nike's stock may decline further before a rebound, allowing for significant profits when the turnaround occurs [8] Group 3: Pershing Square Capital and Uber - Ackman initiated a position in Uber in the first quarter of 2025, which has become the top position in the portfolio, accounting for nearly 18% [10] - He noted a decline in Uber's valuation at the end of 2024 as an opportunity, and believes the stock remains undervalued despite its 53% increase this year [10] - Ackman praised Uber's management, low costs, and growth potential, citing a 20% compounded annual growth in bookings since 2019, currently at $160 billion, and projecting earnings growth of at least 30% in the medium term [12] Group 4: Uber's Market Position and Future - Ackman addressed concerns regarding autonomous vehicles (AVs) potentially threatening Uber's business model, arguing that AVs are still in development and unlikely to dominate ridesharing soon [13] - He emphasized Uber's dynamic supply model as a competitive advantage, suggesting that when AVs become safer, they can be integrated into Uber's existing framework [13] - Ackman views Uber as a long-term investment opportunity, particularly for those willing to accept some risk [14]