Bill Ackman Stock Portfolio: 8 Top Stock Picks

5. Howard Hughes Holdings Inc. (NYSE:HHH)

Number of Hedge Fund Holders as of Q2: 35

Pershing Square’s Equity Stake: $1.22 Billion

Howard Hughes Holdings Inc. (NYSE:HHH) is Bill Ackman’s top investment player in the real estate sector. He held 18.85 million shares in the company, valued at $1.22 billion. The company holds various properties, including multifamily residential, hospitality, and seaports.

The main line of business for Howard Hughes Holdings Inc. (NYSE:HHH) is the creation of master-planned communities or MPCs. Rather than the smaller neighborhoods; these large-scale developments are more appropriately characterized as small cities.

Howard Hughes Holdings Inc. (NYSE:HHH)’s business strategy aims to create value over the long run. The company buys large tracts of land (like the 37,000 acres it bought in the Phoenix area a few years ago) and sells homebuilders a smaller portion of the land so they can build residential communities.

These residences generate demand for commercial real estate, such as retail and office buildings, which Howard Hughes Holdings Inc. (NYSE:HHH) develops and leases for rental income. Because of these business facilities, home builders find the surrounding land to be more valuable and sell more homes.

The goal is to construct as many value-added elements as possible to optimize the raw land’s worth. There is no denying the business’s success. For instance, the price per acre at its Houston-based Woodlands MPC increased from $364 to $2,273 between 2011 and 2024. Because of its skill at developing land, Howard Hughes increased the value of its land portfolio from $3.7 billion to $4.1 billion between 2017 and 2024, even after selling 3,447 acres for $2.1 billion.

The Texas-based company bounced back to profitability in the second quarter with earnings of 42 cents a share from a loss of 39 cents a share last year owing to robust residual land sales in its master-planned communities. Its revenues were up 44% to $317.4 million.

Of the 912 hedge funds tracked by Insider Monkey at the end of Q2 2024, Howard Hughes Holdings Inc. (NYSE:HHH) was held by 35 hedge funds, compared to 32 in the previous quarter.