In This Article:
Last Friday, the omicron strain of COVID-19 was officially dubbed a “variant of concern” — and the markets sure got concerned.
In fact, with the Dow Jones Industrial Average shedding 905 points, Friday was the worst day this year for the benchmark index. But not everyone is turning bearish.
“Early reported data suggests that the omicron virus causes ‘mild to moderate’ symptoms (less severity) and is more transmissible,” tweeted Bill Ackman, founder of hedge fund Pershing Square, on Sunday. “If this turns out to be true, this is bullish not bearish for markets.”
He later clarified that it would be bullish for the equity market and bearish for the bond market — and since Ackman’s hedge fund has an equity portfolio valued at over $9 billion, let’s take a look at some of those holdings.
One could turn out to be a profitable pickup, especially if you’re investing for free.
Restaurant Brands International (QSR)
Restaurant Brands International came into existence in 2014 through the merger of Burger King and Canadian coffee chain Tim Hortons. Then in 2017, the company added Popeyes Louisiana Kitchen to its portfolio.
Like most restaurant stocks, Restaurant Brands shares tumbled during the pandemic-induced market sell-off in early 2020. But the stock has made a strong recovery, backed by substantial improvements in the company’s business.
According to the latest earnings report, comparable sales — a key measure of a restaurant chain’s health — increased 8.9% at Tim Hortons, 7.9% at Burger King, but slipped 2.4% at Popeyes Louisiana Kitchen.
Adjusted earnings came in at $0.76 per share for the quarter, compared to $0.68 per share it earned in the year-ago period.
Restaurant Brands is offering a healthy annual dividend yield of 3.7%. For comparison, that’s a higher yield than fast-food giants McDonald’s (2.2%), Starbucks (1.8%) and Yum! Brands (1.6%).
But if you’re finding it hard to pick individual winners in this uncertain environment, remember some investing apps will build you a passive income portfolio automatically just by using leftover change from your everyday purchases.
Lowe’s Companies (LOW)
Lowe’s is Bill Ackman’s largest holding by market value, and the position has served the billionaire investor quite well. Shares of the home improvement retail giant are up 55% year-to-date, while the S&P 500 has returned just 26%.
What’s more impressive than Lowe’s short-term stock price performance is how the company’s dividend has grown over decades. In fact, Lowe’s has increased its payout to shareholders every year for the past 59 years.