We recently published a list of Billionaire Bill Ackman’s 7 Stock Picks with Huge Upside Potential. In this article, we are going to take a look at where Restaurant Brands International Inc. (NYSE:QSR) stands against other billionaire Bill Ackman’s stock picks with huge upside potential.
Known commonly as Bill Ackman, William Albert Ackman is the founder and Chief Executive Officer of Pershing Square, a hedge fund renowned for its focused investment strategy and high-conviction portfolio. Ackman is known for maintaining a highly concentrated investment approach, often holding stakes in only 8 to 12 companies at any given time. By the end of the fourth quarter of 2024, Pershing Square’s portfolio was valued at $12.66 billion and included ten stocks, with over 50% of the fund’s capital concentrated in just the top four investments. This exemplifies Ackman’s commitment to identifying and capitalizing on undervalued opportunities, favoring companies that he believes are mispriced in relation to their intrinsic, long-term value.
Ackman’s investment philosophy has largely centered on value-based principles and activist strategies. His ability to identify market inefficiencies and apply pressure for change has yielded significant returns in the past. Pershing Square’s portfolio selections typically reflect this strategy, with a strong emphasis on companies with solid fundamentals and potential for operational or financial turnaround.
In early 2024, Ackman took a notable step by launching a U.S. closed-end fund named Pershing Square USA, Ltd. However, the initial public offering (IPO) of the fund was abruptly canceled just one day after filing with the Securities and Exchange Commission (SEC). The cancellation followed an unexpected drop in valuation from an intended $25 billion to just $2 billion. Following the cancellation, Ackman posted on the social media platform X that the firm would “report back once we are ready to launch a revised transaction,” suggesting that Pershing Square USA may still proceed in the future without a traditional stock exchange listing.
Ackman’s active engagement with both market trends and political developments illustrates his multifaceted approach to investing. As Pershing Square continues to evolve, close attention is being paid to the stocks within its concentrated portfolio, particularly those with the highest upside potential in light of current economic and political tailwinds.
Our Methodology
For this list, we searched through Pershing Square’s Q4 2024 13F filings to identify billionaire Bill Ackman’s stock picks with the highest upside potential. We compiled the equities with upside potential higher than 12% at the time of writing this article and analyzed why they stood out as sound potential investments. Finally, we ranked the stocks based on the ascending order of their upside potential. To assist readers with more context, we mentioned the hedge fund sentiment around each stock using data from 1,009 hedge funds tracked by Insider Monkey in the fourth quarter of 2024.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 363.5% since May 2014, beating its benchmark by 208 percentage points (see more details here).
Bill Ackman of Pershing Square
Restaurant Brands International Inc. (NYSE:QSR)
Number of Hedge Fund Holders as of Q4: 31
Pershing Square’s Equity Stake: $1.50 Billion
Upside Potential as of May 5: 15.21%
Restaurant Brands International Inc. (NYSE:QSR) is a Canadian-American multinational fast-food holding company and one of two restaurant-related investments held by billionaire investor Bill Ackman through his hedge fund. As of the fourth quarter of 2024, Pershing Square owns over 23 million shares in the company, valued at just under $1.5 billion. Ackman’s position reflects his continued confidence in the long-term growth potential of Restaurant Brands International, which operates more than 30,000 restaurants in over 120 countries. The company owns four major quick-service restaurant chains: Tim Hortons, Burger King, Popeyes, and Firehouse Subs. It was formed in 2014 from the merger of Tim Hortons and Burger King and later expanded through the acquisition of Popeyes in 2017 and Firehouse Subs in 2021.
For its most recent quarter, Restaurant Brands International Inc. (NYSE:QSR) reported better-than-expected financial results. Adjusted earnings per share came in at 81 cents, beating analysts’ expectations of 79 cents. Revenue reached $2.3 billion, also exceeding forecasts of $2.27 billion. Despite a decline in net income to $361 million, down from $726 million a year earlier, the company saw net sales climb 26%. This growth was largely attributed to the acquisitions of its largest U.S. Burger King franchisee and Popeyes China, which took place in the prior year.
CEO Josh Kobza highlighted the company’s performance, noting that a 2.5% same-store sales growth across all brands represented a solid showing relative to industry peers. Internationally, same-store sales grew by 4.7%, surpassing analyst estimates of 2.7%, driven primarily by strength in Burger King and Popeyes. Restaurant Brands International Inc. (NYSE:QSR) also expanded its restaurant base by 3.4%, adding 1,055 new locations compared to the same period the previous year. Looking ahead, Restaurant Brands plans to invest between $400 million and $450 million in 2025 on capital expenditures, tenant inducements, and other strategic incentives to fuel further growth.
The company’s growth potential has also caught the attention of other institutional investors. According to Insider Monkey’s database, 31 hedge funds held positions in Restaurant Brands International Inc. (NYSE:QSR) at the end of Q4 2024, up from 29 in Q3. This growing interest underscores investor confidence in the company’s strategic direction and international expansion opportunities.
Pershing Square Holdings stated the following regarding Restaurant Brands International Inc. (NYSE:QSR) in its Q2 2024 investor letter:
“Restaurant Brands International Inc.’s (NYSE:QSR) two largest brands delivered impressive results this quarter. Tim Hortons’ same-store sales in Canada grew by nearly 5%, outpacing all competitors and the broader industry. These strong results are due to the multi-year investment the company has made in broadening its food platform and expanding its lead in cold beverages. Burger King International reported same-store sales of more than 2%, despite ongoing boycotts of western brands. Burger King is outperforming McDonald’s on a one-year basis and relative to pre-covid levels. Its success in international markets provides a blueprint for its ongoing turnaround in the U.S., where the company is focused on modernizing its store base and growing its digital business. As part of that effort, the company acquired Carrols, Burger King’s largest franchisee, which will allow the company to accelerate remodels and help shift the franchise system towards smaller more entrepreneurial operators, setting the brand up for long-term success. The company intends to refranchise the Carrols restaurants to smaller operators once the stores are performing at strong levels.
In light of weakening economic conditions and ongoing boycotts, the company lowered its net restaurant and system-wide sales growth outlook this year. In response, the company is enacting a cost savings program which will enable it to grow operating profits by more than 8%. While an uncertain environment may impact unit growth in the near-term, we believe each of the company’s brands will benefit in a slower economic environment with consumers trading down.
Despite strong performance at its largest brands, consistent operating profit growth, and a business model that benefits in a recessionary environment, QSR still trades at a meaningful discount to its peers. As the company returns to its historic mid-single-digit unit growth and delivers consistent performance at each of its brands, we believe the company’s share price will more accurately reflect its improving fundamentals.”
Overall, QSR ranks 6th on our list of billionaire Bill Ackman’s stock picks with huge upside potential. While we acknowledge the potential of QSR as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns and doing so within a shorter timeframe. There is an AI stock that went up since the beginning of 2025, while popular AI stocks lost around 25%. If you are looking for an AI stock that is more promising than QSR but that trades at less than 5 times its earnings, check out our report about this cheapest AI stock.
READ NEXT: 20 Best AI Stocks To Buy Now and 30 Best Stocks to Buy Now According to Billionaires.
Disclosure: None. This article is originally published at Insider Monkey.
