Billionaire Ackman Labels Fannie and Freddie Stocks a Bargain Leading Shares to Surge
Bill Ackman recently described the stocks of Fannie Mae and Freddie Mac as “stupidly cheap.” His remarks have significantly impacted the market, leading to remarkable gains for both companies.
Stock Surges Following Ackman’s Comments
On Monday, shares of Fannie Mae rose by 37% while Freddie Mac increased by 33%. These substantial gains mark the largest intraday increases for both companies since May 2025.
Ackman’s Advocacy for Relisting
Ackman, the founder of Pershing Square Capital Management, has been a staunch advocate for the relisting of Fannie Mae and Freddie Mac on the New York Stock Exchange. His hedge fund has publicly petitioned the Trump administration, aiming for these companies to exit conservatorship.
Financial Implications
- Ackman believes that lifting conservatorship could generate up to $300 billion for taxpayers.
- Fannie Mae and Freddie Mac accounted for approximately 10.8% of Pershing Square’s portfolio performance in 2025.
Background on Fannie Mae and Freddie Mac
Both entities were placed into conservatorship in 2008 during the financial crisis. As a result, they were directed to delist from the stock exchange in 2010 after their share prices fell below $1. Currently, their stocks trade on over-the-counter markets.
Market Conditions and Future Prospects
Despite a recent rise in stock prices, the companies face challenges due to slowing homebuying and rising mortgage rates. Observers are keen to see if the Trump administration will announce IPO plans for these mortgage giants.
- Trump hinted in May 2025 that he was “working on” plans to take them public.
- Federal Housing Finance Agency Director Bill Pulte suggested an IPO announcement could come by March.
Investment Outlook
Ackman expressed confidence that the stocks could yield a tenfold return on investment. However, investor sentiment remains guarded, especially in light of economic uncertainties highlighted by critics like Michael Burry.
Ackman’s Financial Standing
With an estimated net worth of $8.8 billion, Bill Ackman ranks among the wealthiest individuals globally. His hedge fund manages around $30 billion in assets, diversifying its investments across multiple sectors, including technology and transportation.
As the market reacts to these developments, the potential for Fannie Mae and Freddie Mac remains in the spotlight, raising questions about their future in the public market.
