Ackman Exits Chipotle, Bets Big on Amazon's AI Future
💡 Key Takeaway
Bill Ackman's shift from CMG to AMZN signals a major rotation from mature restaurant growth to cloud/AI dominance at attractive valuations.
The Great Rotation: From Burritos to Cloud Computing
Billionaire investor Bill Ackman's Pershing Square Capital Management made two dramatic moves revealed in its recent 13F filing. The fund completely exited its position in Chipotle Mexican Grill, which had been its top holding as recently as March 2024. By December 2025, Ackman had sold all 21.5 million remaining shares.
Meanwhile, Ackman has been aggressively accumulating shares of Amazon over the past three quarters. After opening a position of 5.8 million shares in Q2 and maintaining it through Q3, he added another 3.8 million shares in Q4, bringing his total stake to over 9.6 million shares. Amazon is now Pershing Square's third-largest holding.
The Chipotle exit comes after a remarkable nine-year run where the stock more than quadrupled, significantly outperforming the S&P 500. The sale represents Ackman cashing in on substantial gains from an investment that began in September 2016.
For Amazon, the accumulation reflects growing conviction in the tech giant's dual-business model and its positioning within the AI revolution. Ackman has been steadily building this position since mid-2025.
Reading the Tea Leaves: What Ackman's Moves Signal
Ackman's complete exit from Chipotle suggests he sees limited upside remaining after the stock's tremendous run. More importantly, Chipotle's fundamental picture has deteriorated, with comparable restaurant sales declining 1.7% in 2025 after years of strong growth. This indicates that inflationary pressures may finally be impacting consumer spending at the burrito chain.
The forward P/E ratio of 26 for Chipotle looks expensive for a restaurant chain experiencing negative same-store sales growth. Without the supercharged growth that justified premium valuations in the past, Chipotle may be facing a valuation reckoning.
Amazon represents the opposite scenario - a company with dominant market positions trading at historically attractive valuations. While most consumers know Amazon for its e-commerce platform, the real profit engine is Amazon Web Services, which is experiencing reaccelerating growth thanks to AI adoption.
At approximately 10 times forecast 2027 cash flow, Amazon trades at a significant discount to its historical median multiple of 30 times cash flow during the 2010s. This valuation gap, combined with AWS's AI-driven growth, makes Amazon compelling to value-oriented investors like Ackman.
Bobby Insight
Ackman's rotation into Amazon is strategically sound given its AI exposure and attractive valuation.
Amazon's dominant cloud position through AWS provides a durable competitive advantage, while the current valuation at ~10x forward cash flow represents a historical bargain. The AI-driven reacceleration in AWS growth creates a powerful growth catalyst that Chipotle lacks.
What This Means for Me
