Bill Ackman of Pershing Square is just wild about Fannie, and is buying shares of Fannie Mae and Freddie Mac even as other investors exit the stock. Ackman, along with other hedge fund managers, filed a lawsuit against the government for seizing the mortgage insurers during the great recession and that it did not compensate shareholders sufficiently.
Ackman argues that Fannie Mae lost a lot of money on this move, even though the government was bailing out the company. The case was thrown out by a U.S. District Court, but Ackman feels that an appeal will be successful and that will bring Fannie’s share price up.
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He said, according to Valuewalk, “The adverse ruling resulted in a large decline in Fannie and Freddie’s respective shares, and we used the opportunity to purchase additional shares in both companies.” Ackman and company are currently regrouping in order to attempt to reverse the court’s decision.
