Hilton

Hilton in 2026 is Bill Ackman's longest-held position outside of Berkshire — Pershing Square has owned HLT continuously since 2018. The thesis was simple: Hilton is no longer a hotel company. It is an asset-light, fee-based franchise platform with 78% gross margins and 57% operating margins — closer in economics to Visa or Mastercard than to Marriott of 1990. Pershing Square holds 8.4M shares (~$2.7B) as of Q1/2026, representing 16% of the fund's portfolio.

The 2026 story is Tru by Hilton plus Spark Hilton — the budget-extended-stay brand families that are taking share from independent lodging. Tru opened 78 net new hotels in 2025 (+18% pipeline growth), and Spark Hilton (launched 2023) is now at 95 hotels with 4.2 RevPAR index versus average regional comp. Hilton's pipeline now stands at 462,000 rooms — almost a third of its 2025 portfolio size (1.18M rooms).

The hidden engine is Hilton Honors. The loyalty program reached 200M members in Q4/2025 — up from 158M in 2024 — and member spend now drives 65% of total occupied room-nights. Co-brand credit-card revenue (American Express partnership) reached $1.1B in 2025 with 28% YoY growth. The loyalty network effect is widening every quarter — and Marriott Bonvoy is the only competing platform at remotely similar scale.

Bill Ackman's Pershing Square has held Hilton continuously since 2018, making it the longest-held active position in Pershing Square outside of legacy Burger King/Restaurant Brands. Pershing holds 8.4M shares ($2.7B at Q1/2026 marks) — 16% of fund AUM and 4.4% of total Hilton shares outstanding. Ackman has not trimmed in 18 months.

Other notable smart-money: Bill Miller of Miller Value Partners added 240K shares in Q1/2026, citing the 'permanent secular shift from independent to franchised lodging' as the unbroken thesis. Vanguard added 1.2M shares (organic ETF rebalancing). Marshall Wace also entered as a top-30 holder with 2.1M shares in Q4/2025.

Insider activity (Form 4): CEO Chris Nassetta sold 188,000 shares in February 2026 at $312 (10b5-1 routine). Notably, Nassetta has acquired 50,000 shares through RSU vests but has not made an open-market buy in 7 years. CFO Kevin Jacobs sold 75,000 shares in March 2026 at $318. No insider buying signals — but this is the established baseline at Hilton, not a thesis-break.

Hilton trades at a forward P/E of 30.4× and EV/EBITDA of 19× as of May 2026 — the premium end of lodging-comp peers (Marriott at 25×, Hyatt at 22×, Choice Hotels at 18×). The bull case (Wells Fargo, Stifel) values Hilton at $385-390 on a continued 39% pipeline-to-portfolio expansion and 25% earnings CAGR through 2028. The bear case (Barclays) at $260 assumes a 2027 US recession compresses both RevPAR and pipeline-completion rates. Wall Street analyst targets range from $260 (Barclays) to $390 (Wells Fargo), median $347 vs. current $317 — 10% upside before the modest 0.2% dividend. The buyback yield is ~3.5% on a $4B 2026 authorization — modest contributor.

1. July 22, 2026: Q2/2026 earnings — system-wide RevPAR growth is the critical KPI; <3.5% growth pressures the bull thesis
2. October 2026: Q3/2026 earnings — first full peak-leisure-season data point on whether Tru and Spark Hilton are taking share from independents or just adding capacity
3. February 2027: Hilton Investor Day — first formal management framework on 2030 pipeline ambition and brand-portfolio strategy

Hilton is the cleanest 'asset-light franchise compounder' in lodging — and Ackman's 8-year unbroken hold is the strongest non-verbal endorsement of the thesis. The economics are real: 57% operating margin on a hospitality business is a structural anomaly. What I struggle with at $317 is the multiple. Forward P/E 30× is hilton-bubble territory historically, and a US-leisure-recession scenario in 2027 would compress this 30-40%. I hold HLT at 2% of my portfolio with a no-add zone between $290-$340 and an active-add trigger below $260 (forward P/E 25, recession-tested entry). My personal play book here is patient: the pipeline and Honors network effects keep compounding through cycles, but you should not pay 30× to enter mid-cycle. Wait for the discount.