Investing.com – BofA Securities initiated coverage on Pershing Square Inc (NYSE:PS) with a Neutral rating and a price target of $42.00.
The firm set its price target based on a 45x multiple on its 2028 earnings per share estimate, which implies a 20% total return. The stock currently trades at $35.67, down from $37.72 in the previous session, reflecting a 13% decline over the past week despite posting strong 47% returns year-to-date. Pershing Square is a US asset manager that manages concentrated portfolios of public large-cap equities and can apply asymmetric hedges.
The company is the first hedge fund to market directly to US individual investors following a 2025 SEC policy shift. BofA Securities noted that 96% of Pershing Square’s fee-paying assets under management is permanent and cannot be redeemed.
This structure helps the firm avoid forced-selling situations and allows it to allocate fewer resources to marketing compared to other asset managers. Many private equity firms must return all capital to limited partners and operate on a fundraising treadmill.
Pershing Square earns fees on fund appreciation, unlike typical private equity firms. BofA Securities said these qualities mean the company’s model is referred to as baby Buffett as it replicates similar Berkshire Hathaway features. The company has demonstrated strong operational performance with 67% revenue growth and an 18.7% return on assets. However, InvestingPro analysis suggests the stock may be overvalued at current levels, with 6 additional ProTips available for subscribers seeking deeper insights into the company’s valuation metrics.
In other recent news, announced it will experience reduced performance fees following the completion of initial public offerings by Pershing Square USA, Ltd. and Pershing Square Inc. The $5 billion IPO of Pershing Square USA, Ltd. was finalized this week, leading to a reduction in performance fees by an amount equal to 20% of management fees earned by its investment manager, Pershing Square Capital Management, L.P., from PSUS. Additionally, Pershing Square USA, Ltd. and Pershing Square Inc. announced the pricing of a combined initial public offering with aggregate gross proceeds of $5 billion. The shares of both entities are expected to commence trading on the New York Stock Exchange under the symbols and NYSE:PS, respectively. The combined IPO is anticipated to close on April 30, 2026, subject to customary closing conditions. These developments mark significant financial activities for Pershing Square Holdings and its associated entities.
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