Pershing Square Investor Meeting: NAV +20.9%, PSUS Redesign, Howard Hughes to “Berkshire” Model

Core Insights - Pershing Square Holdings (PSH) demonstrated strong financial performance in 2025, with a net asset value (NAV) increase of 20.9% and a total shareholder return of 33.9% [2][6] - The company is undergoing a transformation of its long-held investment in Howard Hughes, aiming to evolve it into a diversified company similar to Berkshire Hathaway [5][10] - PSH is redesigning its planned U.S. vehicle, PSUS, to reduce performance fees, while also focusing on strategic initiatives and shareholder engagement [6][9] Financial Performance - PSH reported a weighted average maturity of six years and a weighted average cost of capital of 3.6%, with a debt-to-total-capital ratio maintained between 15% and 25% [1] - The company issued two bonds in 2025: a €650 million five-year bond at 4.25% and a $500 million seven-year bond at 5.5% [1] - Over the last eight years, PSH achieved a compound growth rate of 23% in both NAV and share price, outperforming the S&P 500 and FTSE [2] Governance and Shareholder Engagement - The board of PSH held seven meetings in 2025, focusing on portfolio performance, strategy, and governance issues [3] - The manager of PSH is also its largest shareholder, owning 28% of the company, which aligns interests [3] Strategic Initiatives - PSH is transforming Howard Hughes into a diversified holding company, with a $900 million investment made in May 2025 [5][10] - The planned acquisition of Vantage, a specialty insurer, for approximately $2.1 billion is a key step in this transformation [12] - PSH's management team will provide support to Howard Hughes in exchange for management fees, which will offset PSH's own management fees [11] Market Activity and Investments - In 2025, PSH made new investments in Hertz, Amazon, and Meta, while exiting positions in Chipotle, Canadian Pacific, and Nike [14] - The company executed share buybacks totaling $370 million in 2025, bringing total buybacks to $1.8 billion, reducing shares outstanding by nearly 30% [8] Market Conditions and Outlook - The Chief Investment Officer noted that the S&P 500's growth has been primarily driven by earnings growth rather than multiple expansion, with a focus on large companies [16] - PSH's ability to quickly invest in mega-cap stocks during market volatility is emphasized as a strategic advantage [16]