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Bill Ackman Invests in Chipotle

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Zam M

on 8 September 2016

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Transcript of Bill Ackman Invests in Chipotle

New York Times Dealbook, Sept. 6, 2016
CAN BILL ACKMAN SPICE UP CHIPOTLE LIKE JEFF SMITH SAVED OLIVE GARDEN?
By Zameena Mejia
Thursday, September 8, 2016
Covering Companies
Activist investor
Bill Ackman: who is he & why is he in the headlines?
Reuters Now, Sept. 8 2016
Billionaire who announced 9.9 percent stake in Chipotle—aka a $1.2 billion bet he can turn Chipotle around
Bill Ackman Invests in Chipotle
Ackman and Chipotle Are a Recipe for Indigestion
Despite having more wins than losses, he's still facing backlash for his bets on nutritional products maker Herbalife (pyramid scheme?) or for drugmaker Valeant, which with other key holdings, dragged his fund to its worst annual performance in 2015.
Founder and activist hedge fund manager at Pershing Square Capital Management
An
activist investor
is an individual or group that purchases large numbers of a
public company's
shares and/or tries to obtain seats on the company's board
with the goal of effecting a major change in the company
. A company can become a target for
activist investors
if it is
mismanaged
, has excessive costs, could be run more profitably as a private company or has another problem that the activist investor believes it can fix to make the company more valuable.
 —Investopedia

Remember the E. coli outbreak this year?
Sources
http://www.investopedia.com/terms/a/activist-investor.asp
Some people don't think Ackman is in a place to make a risky investment in Chipotle.
Bloomberg Gadfly, Sept. 7, 2016
https://www.bloomberg.com/gadfly/articles/2016-05-06/herbalife-cuts-short-ackman-s-happy-friday

https://www.bloomberg.com/gadfly/articles/2016-09-07/bill-ackman-chipotle-bet-recipe-for-indigestion

http://www.vanityfair.com/news/2016/09/bill-ackman-chipotle

http://www.reuters.tv/v/Mlu/2016/09/08/chipotle-hoping-to-heat-up-again-with-ackman-stake
Ackman Must Think Chipotle Can Break the Laws of Mathematics or Economics: Analyst
Chipotle Jumps After Bill Ackman Buys the Dip
Experts can't fathom what Bill Ackman has planned for Chipotle
Vanity Fair Hive, Sept. 7, 2016
Other angles I might have covered:
Bloomberg Markets, Sept. 7, 2016
"Low hanging fruit"
"High margin business"
http://www.bloomberg.com/news/articles/2016-09-07/bill-ackman-must-think-chipotle-can-break-the-laws-of-mathematics-or-economics-analyst-says

http://blogs.barrons.com/focusonfunds/2016/09/06/chipotle-jumps-after-ackmans-pershing-square-reveals-its-buying-the-dip/

http://finance.yahoo.com/news/chipotle-ackman-9-9-stake-activism-food-safety-212744629.html

http://www.nytimes.com/2016/09/07/business/dealbook/bill-ackman-chipotle.html?ref=dealbook&_r=1

http://fortune.com/2016/09/07/chipotle-stock-bill-ackman/
Barrons, Sept. 6, 2016
William Ackman’s Pershing Square Takes a Stake in Chipotle

Very brief article
Yahoo Finance, Sept. 7, 2016
Analysts point to major issues for Chipotle upside:

1) Reliance on promotions driving traffic
2) Increased permanent costs from increased food safety compliance
3) Higher exposure to $15 per hour minimum wage mandates
4) Legal risk
5) No longer a growth story
Chipotle hoping to heat up again with Ackman stake
—Bloomberg Gadfly, May 2016
Actual profits Ackman's making made (but Fortune did a good job of covering this)
Millenials' role in fast-casual food chains
The future of fast-casual restaurants
"Healthy" fast food movement Ackman is apparently known to be a part of
Full transcript