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Bill Ackman buys into S&P Global as he challenges AI fears
The investor argues S&P Global’s Ratings, Indices, and Platts energy pricing businesses have high margins and are not simply data-lookup products that AI can commoditize.
Bill Ackman disclosed in his latest investor letter that he bought shares of S&P Global, a move framed as a response to concerns that artificial intelligence could erode demand for the firm’s financial data.
Yahoo Finance reports that Ackman argues the market is focusing on the wrong part of S&P Global’s business. The company operates three benchmark franchises, including Ratings, Indices, and the Platts energy pricing unit, which Ackman says deliver high margins.
According to the report, Ackman also points to the structure of S&P’s Ratings business, which is described as a near-duopoly with Moody’s. The letter contends that ratings matter because they help issuers access borrowing, and that AI cannot replicate the trust and regulatory moat around the rating process.
The article adds that Ackman expects longer term support from ongoing debt issuance, including refinancings in 2027 and 2028, and from buybacks that he says could reduce the share count by about 4% per year. It also highlights risks, including the growth of private credit that could bypass rating agencies, as well as the idea that recession-linked declines in debt issuance could hit ratings revenue.