Pershing Square Holdings (PSH.L)

Financials · LSE · UK

£39.00-0.20% today

Fundamentals

Market cap£6.81B

P/E ratio3.6

Dividend yield1.40%

Revenue growth (YoY)+19.5%

Profit margin72.7%

Return on equity18.0%

Valuation and ratings

DCF fair value£85.58

Upside to fair value+119.4%

Moat score84/100

Overall rating80/100, Strong Buy

Pershing Square Holdings trades at £39.00, which is 119% below the £85.58 our discounted cash flow model puts on the business. On that measure alone it screens as undervalued, though a DCF is an argument rather than a measurement, and the market is frequently right about why something is cheap.

Our moat model scores it 84 out of 100, which is a wide moat. A moat is a structural reason competitors cannot take the profits away, and it matters more to a long holding period than any single quarter's numbers do.

It changes hands at 3.6 times earnings. Be careful reading that in isolation: for a cyclical business a low P/E arrives at the top of the cycle, when profits are peaking and about to fall, which is exactly when the shares look cheapest and are not.

About Pershing Square Holdings

Pershing Square Holdings, Ltd. is a closed-ended balanced fund launched and managed by Pershing Square Capital Management, L.P. It invests in public equity and fixed income markets across the globe. The fund seeks to invest in stocks of companies operating across diversified sectors. It primarily invests in value stocks of companies. For its fixed income portion, the fund primarily invests in convertible securities and debt securities. It also invests through derivatives. The fund employs long/short strategy to create its portfolio. It benchmarks the performance of its portfolio against the S&P 500 Index and HFRX Global Hedge Fund Index. Pershing Square Holdings, Ltd. was formed on February 2, 2012 and is domiciled in Guernsey.

Industry: Asset ManagementHQ: United States

PSH.L passes 6 of our 30 screens today

Each screen prints the exact criteria it used, and the circumstances in which it is wrong.

Undervalued on cash flow

Companies trading at least 25% below what our discounted cash flow model says the future cash is worth today.

Wide moat compounders

Businesses with a structural reason competitors cannot take their profits away. The rarest and most valuable thing in investing.

Deep value, with a pulse

A very low earnings multiple is usually a warning. This screen demands a low multiple AND evidence the business still works.

Fortress balance sheets

Companies that owe almost nothing. They will survive things that kill their competitors, and they can buy the wreckage afterwards.

High margin machines

Companies that keep an unusually large share of every pound they sell. That is pricing power made visible.

Growth at a reasonable price

Real growth, without the multiple that usually comes attached to it. The middle ground between value and growth, and the hardest place to find anything.

Common questions

Is Pershing Square Holdings (PSH.L) undervalued?

Against our discounted cash flow estimate of £85.58, PSH.L at £39.00 is 119% below fair value. That is one model's answer, not a recommendation, and most of a DCF's output sits in a terminal value nobody can forecast.

What is PSH.L's P/E ratio?

PSH.L trades at 3.6 times earnings. A low P/E is not automatically cheap: on a cyclical company it is usually a warning that earnings are at a peak.

The full research page for PSH.L, with financial statements, ownership detail, peer comparison and alerts, is free inside the app.

Open PSH.L in the app Free guides and screens

Data from company filings, exchange quotes and SEC EDGAR 13F disclosures. Quotes are delayed. Metrics we do not have are left out rather than estimated. Educational information, not financial advice.