Ackman's Pershing Square sells Valeant stake, takes $3 billion loss

Markets Insider

Markets Insider

The fall represented a new low for the drugmaker, which makes various pharmaceutical drugs and owns the contact lens maker Bausch & Lomb. His 27.2 million shares reportedly went for about $11 a pop-about $300 million all told-and Valeant's stock headed south by as much as 9% on the news.

Ackman also absorbed an estimated $500 million loss in 2013 when he sold a large stake in retailer J.C. Penney (JCP). "We elected to sell our investment and realize a large tax loss which will enable us to dedicate more time to our other portfolio companies and new investment opportunities", the company said in a statement.

Best time to invest in stock market is when things are on odd side, and it's not easy how to pick stocks. US Bancorp DE now owns 5,745 shares of the specialty pharmaceutical company's stock worth $141,000 after buying an additional 3,361 shares during the last quarter. The current share price indicate that stock is -31.65% away from its one year high and is moving 59.49% ahead of its 52-week low. Coupled with the most recent stock dump, Ackman and Pershing have lost approximately $4 to $5 billion on its Valeant sell-offs. (NYSE:DSW), and electric auto stock Kandi Technologies Group Inc (NASDAQ:KNDI).

Regardless of this development, investors continue to be bullish.

Watch out for the force behind Valeant Pharmaceuticals International, Inc. bullish run in this report?

Ackman, though, doubled down on Valeant stock and took two board seats.

Joe Papa was named Valeant Pharmaceuticals chief executive officer in April 2016.

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In the trailing 12 months period, return on assets ratio of the Company was -5.20% and return on equity ratio was -52.70% while its return on investment ratio was -1.60%.

Ackman had once viewed Valeant as an undervalued company that would eventually overcome this scandal after two to four years of legal scrutiny.

Valeant's stock price has kept sinking despite the lingering hopes that a merger deal might be around the corner. Last August it announced it sold its shares in Canadian Pacific Railway after engineering a proxy campaign and turnaround at the railroad company.

Ackman's concentrated bets and brash declarations - he once said Valeant would hit $448 a share by 2019 - have made him a polarizing figure on Wall Street with some investors keen to take the opposing view from him. Thomson Reuters' First Call, which many consider to be the benchmark for EPS and consensus data, now have the price target listed as $19.8100. Kistler Tiffany Companies LLC increased its stake in Valeant Pharmaceuticals Intl by 95.5% in the third quarter.

But one investor in Ackman's fund, Pershing Square Capital Management, said his departure could give management more room to act and eventually pave the way for other investors to step back in.

Final chords are sounding for Valeant Pharmaceuticals Intl Inc (NYSE:VRX).

Valeant passes RBC to become most valuable company on TSX. Ackman's Pershing Square Capital Management sank some $3.2 billion into the company in 2015.

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