Rumors Swirl About Ackman Investment in Best Buy
There's been a recent spike in the trading of Best Buy Company, Inc., stock, which Bloomberg attributes to speculation that billionaire investor William Ackman has purchased a stake in the company.
Ackman was just in the headlines in late May, when he sold all 7.4 million of his shares of Minneapolis-based Target Corporation. That decision came two years after Target rejected Ackman's proposal to shake up the company's board.
During the past few weeks, shares of Richfield-based Best Buy rose and call-option trades quadrupled, Bloomberg reported on Friday. Call options allow the owner to buy stock at a set price prior to an expiration date.
The rumor that Ackman has bought a stake in Best Buy originated from a report by Patrick Mortimer, director of options trading at New Hope, Pennsylvania-based Pipeline Trading Systems. He wrote in a report to clients that Ackman's Pershing Square Capital Management, LP hedge fund “purchased a stake at the company,” and “option players are taking a bullish stance,” Bloomberg said.
A spokeswoman for Best Buy told Bloomberg that the company wouldn't comment on the trading of its stock or rumors of an investment by Ackman's fund.
Shares of Best Buy's stock rose about 0.3 percent to close at $30.63 on Friday. They slid roughly 2.4 percent to close at $29.88 on Monday.
Read the full Bloomberg story, which details the number and type of call options that have recently exchanged hands, on the Star Tribune Web site here.