Hedge fund executive Bill Ackman called on investors to reacquaint themselves with Fannie Mae (OTCQB: FNMA) and Freddie Mac (OTCQB: FMCC), which resulted in a surge of stock activity for the government-sponsored enterprises (GSEs).
In a series of posts on X on Sunday, Ackman declared, “Some of the highest quality businesses in the world are trading at extremely cheap prices. Ignore the MSM. One of the most one-sided wars in history that will end well for the U.S. and the world. And we have the potential for a large peace dividend. One of the best times in a long time to buy quality. Ignore the bears.”
Ackman, who is the founder and CEO of Pershing Square Management and owns an approximately 10% share in the GSEs, added, “And Fannie and Freddie are stupidly cheap. Asymmetry at its best. They could be a 10X and it could happen soon.”
On Monday, investors took Ackman’s advice seriously. According to a Fortune report, Fannie Mae shares soared by as much as 41% in trading while Freddie Mac shares rose by as much as 34%. These were the largest single-day moves for each stock since last May when President Trump first mused about privatizing the two GSEs.
Ackman’s confidence in the GSEs stands in contrast to a more pessimistic view held by another prominent investor. Last week, Michael Burry of “The Big Short” fame used a Substack posting titled “The Toxic Twins Recurrence” to predict the earliest date for a Fannie-Freddie initial public offering would be 2027.
Photo courtesy of the Pershing Square Foundation
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