Bill Ackman's Pershing Square has taken a new position in Netflix worth about $1 billion, years after a money-losing bet on the stock. Ackman originally plowed roughly $1.25 billion of Pershing Square capital into Netflix in early 2022, only to sell the entire position weeks later at a significant loss after the company unveiled plans for an ad-supported tier, which he said undermined the predictability his concentrated portfolio requires. In an August letter to shareholders, Ackman wrote that Netflix has since effectively won the streaming wars, with advertising now driving live programming and new subscriptions, while free cash flow has ballooned to approximately 90% of earnings. He now expects Netflix to come close to 20% annualized earnings-per-share growth, below the more than 20% he projected in early 2022, a forecast that proved accurate as EPS has compounded 27% since the end of that year's first quarter. Ackman bought again after the stock's valuation sank back to levels last seen in 2022, this time with greater confidence in the advertising business.
Netflix IncPershing Square took a new ~$1 billion stake in Netflix, a major investor endorsement after the prior loss-making bet.
Pershing Square Inc.Pershing Square's new $1 billion Netflix position is the subject of the article, reflecting its investment thesis.
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