Mr. Market Buys Into Ackman’s Plan for Target Corp.

Bill Ackman's detailed presentation to the investment community today was greeted enthusiastically, as evidenced by the stock outperformance today

Ackman does not need CNBC to further his case; a slick internet multimedia presentation included video and slides, and could be a template for future trial balloons.

Of course this was more than a trial balloon, and while Target Corp.'s (TGT-NYSE) is giving him the stiff arm for the time being, his idea certainly might have merit. Ackman essentially wants to have Target set up a REIT that will own land and lease it back to Target for 75 years. It would unlock the value of the land, which I assume is carried at cost on the balance sheet, and minimize taxes. If it can be done without lowering Target's credit rating it might be a go, at least theoretically.

Ackman argues that the stock could trade to $70 if action is taken. While some skepticism was voiced from internet participants during the Q&A portion of the presentation, the crowd in attendance, which included the likes of Ricky Sandler from Eminence Capital, seemed to buy into the thesis.

No doubt the assembled money managers are eager to get back to work after the events of the past few months. It has been a trying time for them, but bottoms up research similar to what Ackman presented is what they do best. I am assuming the long video will be up on Youtube soon, and will post when it becomes available.

Of course the $64,000 question is...will Target's Management take Ackman's proposal more seriously than regulators took his GSE plan?

Target Corporation Reviewing Real Estate Structure Ideas from Pershing Square, LLP
Press Release

The position has not treated Ackman well given his entry point, although he has added on weakness. He briefly commented on part of this thesis last January, which certainly seems like a long time ago.

And you can download his presentation today here....

and watch the video here.
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Whitney Tilson likes Target, plan or not…

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Target Should Create REIT to Boost Value, Ackman Says
Bloomberg
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The content contained in this blog represents the opinions of 1440 Wall Street. This commentary in no way constitutes a solicitation of business or investment advice. It is intended solely for the entertainment of the reader, and the author. No Positions

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