Bill Ackman is high on coffee: his hedge fund Pershing Square Capital has invested about $900 million in Starbucks.
Pershing now owns 15.2 million shares of the café chain. The news pushed Starbucks stock price up by +2.5% on Tuesday, thereby reflecting investor optimism about the hedge fund’s investment in the company.
In support of his investment decision, Ackman mentioned several factors, such as his belief that Starbucks could open more stores in the U.S, the coffee company’s high growth potential in China and the general positive outlook on the coffee industry. Plus, he also indicated that Starbucks’s relatively high wage and benefits for employees make it resilient against any possibility of a hike in the nation’s minimum wage. Ackman has also gone on to say that the company’s stock value could double over the next three years.
Starbucks joins the list of food/restaurant companies, such as Chipotle and Restaurant Brands International, that Pershing has stakes in.