The Morning Brief: Pershing Square Plans Conference Call on Valeant

Pershing Square Capital Management founder William Ackman plans to host a conference call for investors in his Pershing Square Holdings fund to discuss its investment in Valeant Pharmaceuticals International. During the call, which will take place on Friday at 9 a.m. EST, Ackman and other members of his team will address questions e-mailed from investors. A live audio webcast will be available to the public on the fund’s website, and the call will be available by good old-fashioned telephone. Ackman was relatively late to what until this summer was one of the best-performing stocks of the decade. Pershing Square took its initial stake of nearly 19.5 million shares in the second quarter of this year, which made it Valeant’s third-largest shareholder. Last week, Pershing Square added 2 million shares.

Meanwhile, on Tuesday Barclays slashed its price target on Valeant from $300 to $135. However, it did retain its overweight rating on the embattled stock. In a note to clients, the bank asserted that on Monday’s conference call, Valeant addressed many of the bank’s concerns regarding the company’s relationship with specialty pharmacy Philidor Rx, “and specifically concerns over accounting practices.” It also said the “comprehensive” call “provided incremental clarity around many of the issues that have been the focus of investors over the last week.”

However, Barclays concedes that questions linger around Philidor Rx’s business practices. It also acknowledges that some investors are questioning the viability of Valeant’s business model due in part to Philidor as well as the general environment on drug pricing. Barclays says it cut its price target since Valeant’s valuation “will be affected pending resolution of the outstanding issues.” For its part, UBS once again reaffirmed its $285 price target and buy rating.


Deutsche Bank raised its estimates for Athenahealth and raised its price target from $153 to $176, noting that the company “continues to make steady progress in its enterprise segment.” Last week, the billing and medical practice management software company reported much better than expected earnings in the third quarter. This is bad news for David Einhorn’s Greenlight Capital, which is short the stock. However, the shares actually fell Tuesday, by 0.34 percent, to $149.22. Still, the stock is up 33 percent since early July.


Walgreens Boots Alliance surged 6.35 percent on Tuesday on reports it is close to acquiring rival Rite-Aid. Top-ten holders at the end of the second quarter included Greenwich, Connecticut-based Viking Global Investors, which counted the stock as its largest long position, and New York-based Jana Partners, which counted the stock as its third-largest holding at the end of the second quarter.


Macro Risk Advisors is holding its fourth-annual Charity Trading Day this Thursday, October 29. The New York-based equity derivatives strategy and trading firm, which serves hedge funds and other institutional investors, typically donates all of its net commissions it earns that day from executing trades on options, stocks and ETFs. It has so far raised over $1 million from commissions and donations over the past three years. This year it plans to donate proceeds to four charities: Blythedale Children’s Hospital; Project A.B.L.E. (Aid on Behalf of Literacy and Education), which promotes literacy and provides educational opportunities for children and their families in the developing world; One Love Foundation, created in 2010 to honor the memory of Yeardley Love, a University of Virginia senior who was beaten to death by her ex-boyfriend weeks before graduation; and the Navy SEAL Foundation.