Bill Ackman’s Pershing Square recently reported its 8.5% activist stake in Alexander & Baldwin, Inc. (ALEX). The 13D filing showed Bill Ackman bought approximately 102 thousand shares in ALEX, at $42.96 on December 2nd, giving him totally 3,561,943 shares in the stock. Probably it's a typo in the number of shares because Bill Ackman reported the same amount in his past two 13F filings. Now ALEX is trading at $41.95. The stock has returned 8% in 2011, versus SPY’s break-even in 2011.
There are several other hedge funds which were also bullish about the stock in the third quarter. Chuck Royce’s Royce & Associates took a smaller position than Pershing Square. The firm reported 495 thousand shares in ALEX at the end of September. Robert Jaffe’s Force Capital had 304 thousand shares while Curtis Schenker and Craig Effron’s Scoggin had 255 thousand shares in the stock. Martin Whitman's Third Avenue Management sold out its entire 1.14 million shares position in ALEX during the third quarter.
Bill Ackman is a long term value investor, taking advantage of short term downward moves in prices. He is particularly successful at special situations investments. William Ackman's Pershing Square has a very concentrated portfolio. Bill Ackman's returns have displayed option-like characteristics in 2009 and 2010. His General Growth Properties investment is almost as big as John Paulson's subprime shorts. In May 2009, he recommended GGP stock at the Ira Sohn Conference and the stock returned more than 1000% since then. As a result of that investment, Ackman had a great 2010, returning 29.7%. This is very important because one might be imitating 90% of Ackman's holdings and getting below market returns while Ackman's clients enjoy 30% returns.
Per Google Finance, Alexander & Baldwin, Inc. “is a multi-industry corporation with its primary operations centered in Hawaii. A&B operates in five segments in three industries: Transportation, Real Estate, and Agribusiness. The Transportation Industry consists of Ocean Transportation and Logistics Services segments. The Real Estate Industry consists of two segments, both of which have operations in Hawaii and on the United States Mainland. The Real Estate Sales segment generates its revenues through the development and sale of land and commercial and residential properties. Agribusiness, which contains one segment, produces bulk raw sugar, specialty food grade sugars, molasses, green coffee and roasted coffee; markets and distributes green coffee, roasted coffee, and specialty food-grade sugars; provides general trucking services, mobile equipment maintenance, and repair services in Hawaii; and generates and sells, to the extent not used in the Company’s Agribusiness operations, electricity.”