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Yahoo
6 hours ago
- Business
- Yahoo
Hedge fund titan Bill Ackman shares the secret that got him through his lowest moments
At a financial conference, billionaire Bill Ackman shared the life advice that he says got him through a tumultuous time in his life. Applying the principle of compounding interest to his personal life, he said he tried not to look back, because that will depress you, but instead tried to improve a little bit every day. Billionaire hedge fund manager Bill Ackman is known for his activist approach to investments—and, lately, to politics. His personal life has been just as dramatic. In the mid-2010s, Ackman went through an expensive divorce, saw his firm Pershing Square Capital Management lose billions of dollars, and nearly lost control of the company—all within the span of a few years. Ackman shared the story on stage at the Forbes Iconoclast Summit in New York on Thursday. 'I was going through a divorce, which is great financial pressure. The fund was down 30-something percent,' he told Forbes Editor-in-Chief Steve Forbes. 'And then the industry, if you will, sort of ganged up on us,' he said, shorting stocks that Pershing Square owned and going long stocks the fund was shorting, most notably Herbalife. Ackman unwound a position in Valeant by dumping Pershing's stake, which ultimately lost the fund nearly $4 billion. But with the backing of a $300 million loan from JPMorgan Chase, he solidified control of his fund. It was a particular mindset that helped him make it through those years, Ackman recalled. Applying the principle of compounding interest to his personal life, he said, 'my method was just trying to make a little progress every day.' He quipped, 'If you make 0.1% progress every day, it doesn't sound like a lot—but annualized!' So that's what Ackman reminded himself every day, he told Forbes. 'I'm going to make progress. I'm not going to look back to where I was. If I look there, I'm going to get discouraged. I'm just going to focus on the next step, and then the next step, and the next step,' he said. 'You don't notice any meaningful change for the first few weeks,' he added. 'About 90 days in, you're like, 'Okay, I'm here … and I'm just going to keep compounding.'' The curve of progress doesn't look like much initially, Ackman said, but soon—thanks to compounding—it takes off. While Ackman's near-professional-death experience was particularly stark, he believes his approach to progress can benefit anyone. 'All of us are going to have a moment like this, unfortunately… It could be a health issue. It could be you're fired from your job, your startup fails,' he said. 'And it's even harder when you've fallen from a high place to a low place.' After several years in a low place, Ackman is today back on top. His net worth nearly doubled last year to an estimated $8 billion after a new valuation round for Pershing Square. And while his divorce from his first wife reportedly cost a nine-figure amount, Ackman is now happily remarried to designer Neri Oxman. This story was originally featured on
Yahoo
8 hours ago
- Business
- Yahoo
Hedge fund titan Bill Ackman shares the secret that got him through his lowest moments
At a financial conference, billionaire Bill Ackman shared the life advice that he says got him through a tumultuous time in his life. Applying the principle of compounding interest to his personal life, he said he tried not to look back, because that will depress you, but instead tried to improve a little bit every day. Billionaire hedge fund manager Bill Ackman is known for his activist approach to investments—and, lately, to politics. His personal life has been just as dramatic. In the mid-2010s, Ackman went through an expensive divorce, saw his firm Pershing Square Capital Management lose billions of dollars, and nearly lost control of the company—all within the span of a few years. Ackman shared the story on stage at the Forbes Iconoclast Summit in New York on Thursday. 'I was going through a divorce, which is great financial pressure. The fund was down 30-something percent,' he told Forbes Editor-in-Chief Steve Forbes. 'And then the industry, if you will, sort of ganged up on us,' he said, shorting stocks that Pershing Square owned and going long stocks the fund was shorting, most notably Herbalife. Ackman unwound a position in Valeant by dumping Pershing's stake, which ultimately lost the fund nearly $4 billion. But with the backing of a $300 million loan from JPMorgan Chase, he solidified control of his fund. It was a particular mindset that helped him make it through those years, Ackman recalled. Applying the principle of compounding interest to his personal life, he said, 'my method was just trying to make a little progress every day.' He quipped, 'If you make 0.1% progress every day, it doesn't sound like a lot—but annualized!' So that's what Ackman reminded himself every day, he told Forbes. 'I'm going to make progress. I'm not going to look back to where I was. If I look there, I'm going to get discouraged. I'm just going to focus on the next step, and then the next step, and the next step,' he said. 'You don't notice any meaningful change for the first few weeks,' he added. 'About 90 days in, you're like, 'Okay, I'm here … and I'm just going to keep compounding.'' The curve of progress doesn't look like much initially, Ackman said, but soon—thanks to compounding—it takes off. While Ackman's near-professional-death experience was particularly stark, he believes his approach to progress can benefit anyone. 'All of us are going to have a moment like this, unfortunately… It could be a health issue. It could be you're fired from your job, your startup fails,' he said. 'And it's even harder when you've fallen from a high place to a low place.' After several years in a low place, Ackman is today back on top. His net worth nearly doubled last year to an estimated $8 billion after a new valuation round for Pershing Square. And while his divorce from his first wife reportedly cost a nine-figure amount, Ackman is now happily remarried to designer Neri Oxman. This story was originally featured on
Yahoo
01-06-2025
- Business
- Yahoo
The FTSE 250 looks to be stuffed full of dividend stocks!
In my opinion, investing in dividend stocks is a great way of creating an additional income stream. But they can also play a part in building wealth. To do this, it's necessary to reinvest any cash received and buy more shares. This is a process known as compounding. And in my opinion, it's an effective way of increasing the value of a portfolio. This is best illustrated by way of an example. Let's assume an investor has £10,000 of shares yielding 3.6%. Each year, this would provide income of £360. Over 30 years, this would generate £10,800 of dividends and, assuming there was no capital growth (or losses), the original £10,000 would remain. Alternatively, if the £360 received in year one was reinvested, in the second year it would grow to £373. Repeat this again and, in year three, the income received would increase to £386. And so on… After 30 years, the investment pot would be £28,893. Okay, the investor has sacrificed income of £10,800. But the end result is much better. Of course, this analysis is a little simplistic. Dividends are never guaranteed and share prices can go up and down. However, it does illustrate the potential of dividend stocks. In my example, I used a yield of 3.6%. This is the same rate currently (30 May) available from the FTSE 250. In fact, the index presently offers a higher return than the FTSE 100, its more famous cousin. Look closer and there are many stocks currently yielding more than the average. According to Dividend Data, there are 17 with a yield above 8%. The average of these is 10.2%. Plug this figure into our example above, and £10,000 would grow to £184,267 over 30 years. Interestingly, 13 of the 17 operate in the energy sector, including oil, gas and renewables. Nine are investment trusts. Falling energy prices have impacted industry share prices and helped push yields higher. One example of this is Harbour Energy (LSE:HBR). Its share price has fallen 30% since the start of 2025 and the stock's currently yielding 10.6%. In January, it was close to 6%. The government's 'windfall tax' means profits made from the North Sea are taxed at 78%. This has prompted the group to announce plans to cut its workforce by a quarter and slash domestic investment. To mitigate the impact, in September 2024, Harbour Energy acquired the assets of Wintershall Dea. The majority of its earnings now come from outside UK waters. But a falling oil price affects all regions. The group's now expecting free cash flow (FCF) in 2025 of $900m. This is $100m lower than its previous guidance. Prudently, it assumes a Brent crude price of $65 and a European gas price of $12/msfc (million standard cubic feet) for the remainder of the year. Both are currently trading around these levels. However, volatile energy prices are a risk associated with investing in the sector. But crucially, FCF of $900m is comfortably more than the $455m the group has pledged to return to shareholders this year. Despite the challenges facing the sector, Harbour Energy's dividend looks secure, for now. On this basis, it could be a FTSE 250 income stock for investors to consider. The post The FTSE 250 looks to be stuffed full of dividend stocks! appeared first on The Motley Fool UK. More reading 5 Stocks For Trying To Build Wealth After 50 One Top Growth Stock from the Motley Fool James Beard has positions in Harbour Energy Plc. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors. Motley Fool UK 2025 Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
17-05-2025
- Business
- Yahoo
Lincoln Electric Holdings (NASDAQ:LECO) Looks To Prolong Its Impressive Returns
If we want to find a stock that could multiply over the long term, what are the underlying trends we should look for? In a perfect world, we'd like to see a company investing more capital into its business and ideally the returns earned from that capital are also increasing. Basically this means that a company has profitable initiatives that it can continue to reinvest in, which is a trait of a compounding machine. That's why when we briefly looked at Lincoln Electric Holdings' (NASDAQ:LECO) ROCE trend, we were very happy with what we saw. We've discovered 1 warning sign about Lincoln Electric Holdings. View them for free. Just to clarify if you're unsure, ROCE is a metric for evaluating how much pre-tax income (in percentage terms) a company earns on the capital invested in its business. To calculate this metric for Lincoln Electric Holdings, this is the formula: Return on Capital Employed = Earnings Before Interest and Tax (EBIT) ÷ (Total Assets - Current Liabilities) 0.26 = US$700m ÷ (US$3.6b - US$970m) (Based on the trailing twelve months to March 2025). So, Lincoln Electric Holdings has an ROCE of 26%. That's a fantastic return and not only that, it outpaces the average of 11% earned by companies in a similar industry. Check out our latest analysis for Lincoln Electric Holdings In the above chart we have measured Lincoln Electric Holdings' prior ROCE against its prior performance, but the future is arguably more important. If you're interested, you can view the analysts predictions in our free analyst report for Lincoln Electric Holdings . In terms of Lincoln Electric Holdings' history of ROCE, it's quite impressive. Over the past five years, ROCE has remained relatively flat at around 26% and the business has deployed 61% more capital into its operations. With returns that high, it's great that the business can continually reinvest its money at such appealing rates of return. If these trends can continue, it wouldn't surprise us if the company became a multi-bagger. In short, we'd argue Lincoln Electric Holdings has the makings of a multi-bagger since its been able to compound its capital at very profitable rates of return. And the stock has done incredibly well with a 176% return over the last five years, so long term investors are no doubt ecstatic with that result. So while investors seem to be recognizing these promising trends, we still believe the stock deserves further research. If you'd like to know about the risks facing Lincoln Electric Holdings, we've discovered 1 warning sign that you should be aware of. If you'd like to see other companies earning high returns, check out our free list of companies earning high returns with solid balance sheets here. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
16-05-2025
- Business
- Yahoo
Returns On Capital At Jungfraubahn Holding (VTX:JFN) Have Stalled
If you're looking for a multi-bagger, there's a few things to keep an eye out for. In a perfect world, we'd like to see a company investing more capital into its business and ideally the returns earned from that capital are also increasing. Basically this means that a company has profitable initiatives that it can continue to reinvest in, which is a trait of a compounding machine. That's why when we briefly looked at Jungfraubahn Holding's (VTX:JFN) ROCE trend, we were pretty happy with what we saw. We've found 21 US stocks that are forecast to pay a dividend yield of over 6% next year. See the full list for free. For those that aren't sure what ROCE is, it measures the amount of pre-tax profits a company can generate from the capital employed in its business. The formula for this calculation on Jungfraubahn Holding is: Return on Capital Employed = Earnings Before Interest and Tax (EBIT) ÷ (Total Assets - Current Liabilities) 0.11 = CHF95m ÷ (CHF946m - CHF80m) (Based on the trailing twelve months to December 2024). Thus, Jungfraubahn Holding has an ROCE of 11%. On its own, that's a standard return, however it's much better than the 6.0% generated by the Transportation industry. Check out our latest analysis for Jungfraubahn Holding Above you can see how the current ROCE for Jungfraubahn Holding compares to its prior returns on capital, but there's only so much you can tell from the past. If you're interested, you can view the analysts predictions in our free analyst report for Jungfraubahn Holding . While the current returns on capital are decent, they haven't changed much. The company has consistently earned 11% for the last five years, and the capital employed within the business has risen 24% in that time. Since 11% is a moderate ROCE though, it's good to see a business can continue to reinvest at these decent rates of return. Over long periods of time, returns like these might not be too exciting, but with consistency they can pay off in terms of share price returns. The main thing to remember is that Jungfraubahn Holding has proven its ability to continually reinvest at respectable rates of return. And the stock has followed suit returning a meaningful 79% to shareholders over the last five years. So while investors seem to be recognizing these promising trends, we still believe the stock deserves further research. On a final note, we've found 1 warning sign for Jungfraubahn Holding that we think you should be aware of. For those who like to invest in solid companies, check out this free list of companies with solid balance sheets and high returns on equity. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
