Ackman: Valeant 'The Most Contrarian Stock Investment You Can Own'

Mar 8 2016 | 7:25pm ET

By Svea Herbst-Bayliss (Reuters) - Billionaire investor Bill Ackman on Tuesday called embattled drug company Valeant Pharmaceuticals a "very valuable asset" but forecast that if the company's situation does not stabilize soon new management will be brought in or the company will be sold.

"It will be a messy fourth quarter and a messy first quarter but after that things should stabilize," Ackman, whose Pershing Square Capital Management is Valeant's third largest owner said at the Harbor Investment Conference.

Valeant's share price has tumbled 68 percent since Ackman first bought the stock a year ago. Recently the company said it would have to restate earnings, delayed an earnings call and saw its chief executive return unexpectedly from a long sick leave.

Ackman said that Valeant has a portfolio of valuable products and cited its Bausch and Lomb unit as one of the company's jewels.

While trading in the stock has been volatile recently with investors worried about what may happen next, Ackman said that he expects more clarity soon.

Also chief executive Michael Pearson, who helped build the company, recently came back from an extended sick leave after battling pneumonia. Ackman has previously said publicly that he backed Pearson.

"A lot of the uncertainty will lift in the next weeks," he said referring to the earnings statement expected next week.

But Ackman conceded that Valeant is "the most contrarian stock investment you can own right now."


In Depth

Should You Fire Your Risk Parity Manager?

Feb 22 2016 | 5:57pm ET

Risk parity strategies came under pressure in 2015 as markets sold off risk en masse...

Lifestyle

HFC: Profound Investments in Protecting Children

Feb 19 2016 | 7:21pm ET

Help for Children (HFC) was founded by Rob Davis in 1998 to help prevent and treat...

Guest Contributor

Will Hedge Funds Make a Comeback in 2016?

Mar 1 2016 | 11:39pm ET

In this contributed article, Adam Patti, founder and CEO of exchange-traded fund...