Hedge fund managers became extremely bullish about dollar stores since the beginning of this year. Pershing Square’s Bill Ackman joins Nelson Peltz recommending Family Dollar Stores (FDO). In February Trian Partners’ Nelson Peltz disclosed an activist stake in FDO and revealed that he wanted to take the company private at $55-60. Of course if Peltz wants to pay $60 per share for FDO, it means FDO is worth a whole lot more than that.
Bill Ackman thinks FDO is worth around $92, so the stock, which is trading near $55, has a67% upside potential. Bill Ackman didn’t have any FDO in his portfolio at the end of March. Here are the hedge fund managers who were already bullish about this stock during the first quarter:
1. Nelson Peltz – Trian Partners: $318 Million position
2. Stephen Mandel – Lone Pine Capital: $289 Million position
3. John Paulson – Paulson & Co.: $177 Million
4. James Dinan – York Capital: $101 Million
5. Eric Mindich – Eton Park Capital: $91 Million
6. Jim Simons – Renaissance: $91 Million
7. D.E. Shaw – D.E. Shaw: $76 Million
8. Pavel Begun – 3G Capital: $38 Million
As one can see Bill Ackman is hardly the first investor who is bullish about FDO. This seems like a sure bet for several hedge fund managers.