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The Morning Brief: Ackman Sells 25 Percent of Stake in Burger King Parent

The activist hedge fund pared its share of Restaurant Brands International.

  • By Stephen Taub

Shares of Restaurant Brands International fell about 2.85 percent to close at $77.72 after reports that Bill Ackman’s Pershing Square Capital Management sold 10 million shares for $61 a share, reducing its stake by nearly one-quarter. The company owns the Burger King and Tim Hortons chains. The stock was up 27 percent last year and 18 percent so far this year, even after Wednesday’s selloff.

Pershing Square was down 2.3 percent in the first half of the year and 4.7 percent through July 11, while Pershing Square International lost 0.38 percent for the first half.

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Shares of Facebook jumped 2.3 percent to close at $158.90 after Barclays raised its price target on the most popular hedge fund stock, from $160 to $168, citing the company’s announcement that it will start selling ads on its Messenger app. In a note to clients, the investment bank recommended adding to positions ahead of its second-quarter earnings report, due out on July 26. Barclays says it expects “modest

upside” to consensus revenue and earnings per share in the quarter. “Facebook is transitioning its core franchise to surface more video content, which has positive implications for engagement and revenue, but also comes with additional costs,” Barclays writes.

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Shares of Snap fell another 1.4 percent to close at $15.24 one day after Morgan Stanley, one of its initial public offering underwriters, cut its price target from $28 to $16 and reduced its rating on the stock to equal weight from overweight. The stock now trades below its IPO price of $17. However, on Wednesday another investment

bank provided support for the stock. Barclays told investors to wait until after the lock-up period, banning insiders from selling their shares, expires, noting that the current selloff is creating a longer-term opportunity. “We are encouraged by Snap’s product innovation and the enormous advertising opportunity, and once investors shift the focus back to those areas, shares can potentially work higher,” Barclays writes. “We would wait until the heavy lock-up volume subsides to add to positions,” which it says is likely to occur sometime in the middle of the third quarter. Barclays currently rates the stock equal weight and has an $18 price target.

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