Bill Ackman: Investors Should Own Businesses With Real Pricing Power

In his latest interview with Interactive Investor, Bill Ackman recommends investors own businesses with real pricing power. Here’s an excerpt from the interview:

You want to own businesses that have pricing power. If inflation turns out to be a lot more durable than temporary. I think inflation expectation has changed fundamentally. That’s also the driver of inflation. So I think we’re going to see inflation.

I think that is going to be through… I think there’s going to be a more likelihood of stock market divergence. Some companies doing very very well, some companies doing very very poorly.

Companies that can’t pass through wage inflation and goods inflation to their customers are going to do poorly if I’m right about inflation. So the better the business the better it does I think.

You want to own the best businesses in the world, in an uncertain world, in an inflationary world. If you’re good or better than we are at trading commodities there’s probably a ton of money being made. I just don’t. It’s not what we do.

You can watch the entire interview here: