One was confidence in the new management overseeing Hertz. Another is the Trump administration's new tariffs on imported automobiles, which, by Ackman's math, should benefit the car-rental giant by driving up the value of its fleet of 500,000 used vehicles while also easing its borrowing needs. Hertz is an outlier for New York-based Pershing Square, accounting for less than 2 percent of the total holdings in its $12.6 billion stock portfolio. "For us, it's a relatively small investment," he said. Most of the positions the fund takes are big stakes in "dominant companies with strong balance sheets" and "long-term durable growth" prospects. But on occasion, it spots a business with a "mispriced" stock. "There's a much bigger risk to lose money, but there's a much larger potential to gain," Ackman said. "And Hertz is an example." Buyer beware It's been a bumpy ride for the Florida-based airport fixture, which filed for bankruptcy during the pandemic and is now "levered up," according to Ackman. Its debt load exceeds $16 billion, and the company has struggled after a disastrous decision a few years ago to buy 100,000 Tesla electric vehicles that most renters weren't ready or willing to take for a spin. Ackman likened the Hertz play to Pershing Square's $60 million investment in General Growth Properties during the 2008 financial crisis, after the bankruptcy-bound mall owner's shares skidded to 34 cents from about $34. "And the reason why the stock was down 99-and-a-half percent was they had a lot of debt," he said. At the same time, the real estate company's fundamentals were "solid" and on the upswing, with rent payments and occupancy rates moving higher. "The assets were fine," Ackman said. "These were basically ... the fanciest and the best malls." But he was bothered that stockholders almost always lose their shirts in bankruptcy cases, even if the assets are worth more than the liabilities. He boned up on the topic and posed a question to his lawyers.