Key Takeaways
- Pershing Square shares fell 12% after BofA downgraded the stock to Underperform and cut its price target to $38 from $54.
- BofA lowered its 2026 to 2028 earnings estimates because of a delay in the PSV launch, and it now values the company more like other asset managers.
- Citi’s downgrade to Sell on Friday made the same point: earnings estimates have barely moved since the April IPO.
- What to watch is the flagship fund’s returns: Pershing Square Holdings’ NAV fell 12.6% in the first half of 2026, while the S&P 500 gained 10.2%.
Pershing Square (PS) sank 12% today after BofA downgraded Bill Ackman’s asset manager to Underperform from Neutral before the open and cut its price target to $38 from $54.
It’s the stock’s second downgrade since Friday, when Citi cut it to Sell.
BofA stops paying up for growth
BofA lowered its 2026, 2027, and 2028 EPS estimates because the PSV launch has been delayed, and it also made a small change to its long-term return assumptions. It cut the multiple it uses too, to reflect a lower growth rate and to value Pershing Square the way it values the other asset managers it covers.
That second change matters more. Since its April IPO, the stock has traded as a growth story. BofA now prices it like its peers.
Citi made the same argument a few days earlier. In a note dated Oct. 9, it kept its $45 target and said the stock’s rally had run ahead of its earnings outlook, with estimates broadly flat since the IPO because portfolio returns have been modest. The firm also cut its 2027 EPS estimate to $0.89 from $1.01.
The flagship fund has to deliver
Weak returns are behind both calls. The flagship Pershing Square Holdings (PSH) saw its NAV fall 12.6% in the first half of 2026, while the S&P 500 rose 10.2%. Lower returns mean fewer assets and smaller fees. Citi also now expects performance fees to come back later than it did before.
Even so, consensus still has earnings climbing steeply through 2028…
Those estimates are from Oct. 9, before BofA’s cuts, and Citi’s $0.89 for 2027 is already below the $0.96 consensus.
New funds carry the price
The growth story shows up in the multiple. Here’s Pershing Square’s forward P/E since it listed in April…
Citi values the funds Pershing Square already runs at about $41 a share, and it adds $9 a share for future fund launches. A launch that slips hits the part of the value that hasn’t arrived yet. BofA’s $38 target is below Citi’s value for the existing funds alone.
What would change the call
Back-to-back downgrades tell me Wall Street wants to see the new funds in action before it pays for them. Until PSV has a firm launch date and the flagship fund starts beating the market again, the stock will probably keep trading on the funds Pershing Square already runs.
Citi named two things that could change that: the plan to turn Howard Hughes Holdings (HHH) into an insurance-focused business, and stronger returns from Pershing Square’s existing investments.
So what is Pershing Square stock actually worth?
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Disclaimer:
Please note that the articles on TIKR are not intended to serve as investment or financial advice from TIKR or our content team, nor are they recommendations to buy or sell any stocks. We create our content based on TIKR Terminal’s investment data and analysts’ estimates. Our analysis might not include recent company news or important updates. TIKR has no position in any of the stocks mentioned. Thank you for reading, and happy investing!
