Aug 4, 2016
BNN's Daily Chase: Bill Ackman claims victory as he sells entire CP Rail stake
By Andrew Bell
"After I came home from the 1936 Olympics with my four medals, it became increasingly apparent that everyone was going to slap me on the back, want to shake my hand or have me up to their suite. But no one was going to offer me a job" – Jesse Owens, record-breaking Olympian
Jesse Owens won gold in the long jump at the Olympics in Berlin on this day in 1936, the second of four golds he collected at Hitler's Games. Owens had been mocked by Nazi officials with some calling him and his fellow black athletes "non-humans." On Aug. 3, he took gold in the 100-metre race. The next day he beat Germany's Lutz Long (yes, really his name) in the jump. History.com says that "as Owens and Lutz walked arm in arm around the track, the German crowd roared its approval. Hitler promptly left the stadium, missing the medal ceremony." Later, two American Jews, Marty Glickman and Sam Stoller, were dropped from the U.S. 4 x 100 meter relay in a move seen by some as appeasement of Hitler.
Our Top Line on BNN this morning is the victory claimed by hedge fund jockey Bill Ackman as his Pershing Square Capital Management sells its final 9.8 million shares in Canadian Pacific Railway (CP.TO) after an aggressive proxy campaign that defeated CP's Canadian Establishment board and installed former CN Rail CEO Hunter Harrison as CP's chief executive officer.
"Canadian Pacific has completed an incredible transformation since our initial investment in 2011," Ackman proclaims.
He needs a win. The New York Times says CP has been one of Ackman's most lucrative plays but "Pershing Square has suffered outsize losses on several stocks in its portfolio." They include Valeant Pharmaceuticals (VRX.TO), which is down nearly 80 per cent this year, and a bet against food supplement seller Herbalife (HLF.N), which is up 25 per cent in 2016 even after a US$200-million payment to regulators to settle a probe into its business practices.
At 12:20 p.m. ET, we'll ask Raymond James Steve Hansen if CP has in fact been transformed. He calls the stock – which has sagged 11 per cent on the TSX in the past year – a “strong buy”
It’s hard to find strong buys for miner Iamgold, which has eight holds from analysts and six sells. “With its higher cost structure, Iamgold has struggled to produce free cash flow in the depressed gold price environment,” Canaccord says.
However, the brokerage is raising its target price to $7.50 from $6.50 this morning after the miner “showed operational improvements in Q2/16, highlighting the company’s efforts to optimize performance at its assets.”
Iamgold has sagged 64 per cent in five years, trading at $7 today, but it’s up more than three-fold in a year. Amber Kanwar interviews CEO Steve Letwin at 10:30 a.m. ET.
Finally, speaking of high costs, regular shavers can testify to the exorbitant price of razors. Seems it’s because only a handful of companies can actually produce the things, giving them carte blanche to charge what they want.
“Razor blades are really, really difficult to make,” Jeff Raider, co-founder of online shaving company Harry's, told mentalfloss.com. “It actually starts with buying really fine razor steel. You have to grind steel so that it’s very sharp at its tip and very strong at its base. That gives it both stability and a really crisp cutting surface.”
That’s it. We’re waxing from now on.
Every morning Commodities host Andrew Bell writes a ‘chase note’ to BNN's editorial staff listing the stories and events that will be in the spotlight that day. Have it delivered to your inbox before the trading day begins by heading to www.bnn.ca/subscribe
