Bill Ackman's hedge fund rebounds 10% in May for second-best month since 2014

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Bill Ackman's hedge fund notched a double-digit gain in May, posting its second-best month since 2014.

Bill Ackman's hedge fund notched a double-digit gain in May, getting a boost from investments like Lowe's, Chipotle Mexican Grill, and Automatic Data Processing.

Pershing Square Holdings' 10.3 percent net return last month was its second-best month since 2014, while its 7.5 percent gain through June 5 was notably higher than the broader market's 3 percent climb over the same time.

Pershing's latest moves include stakes in United Technologies and Lowe's , both of which have outperformed the S&P 500 in the past month. News of Ackman's $1 billion investment in Lowe's helped spark another rally in the company's shares, which are now up 18 percent in the past 30 days.

Pershing's stake in the home improvement retailer joins that of D.E. Shaw, which has already wrestled three board seats and overseen the forthcoming retirement of chief executive Robert Niblock.

Another bright spot for Pershing this year has been Chipotle , a company Ackman has heralded as a comeback in the works. The stock is up 56 percent this year, buoyed higher after former Taco Bell chief executive Brian Niccol agreed to lead the struggling burrito chain in February.

Pershing Square declined to comment for this story. The performance data were reported on the publicly traded fund's website.

"Management intends to drive innovation across the business in customer access, digital, and menu, while focusing on fundamentals," Ackman wrote to investors in May. "Near-term initiatives include a reallocation of marketing spend to more productive uses, implementation of a 'test and learn' approach for new products and other initiatives, extended hours, and use of marketing and innovation to convert current downtimes into transaction-driving opportunities."

Though a now net gain for the fund, Ackman's roughly $1 billion stake in Chipotle has seen its fair share of volatility since the original 2016 investment. The company continues to climb its way out of a public relations headache after a series of E.coli outbreaks linked to store locations sent its stock price tumbling.

Still, Pershing has plenty of work to do. The firm has seen its assets cut more than in half from their peak above $20 billion in 2015 as investors gradually fled lackluster returns. The fund posted a 4 percent decline in 2017 despite a largely steady march higher across the S&P 500.

Total firm assets are $8.1 billion as of May 31.

Several high-profile funds have disappointed in recent years, including David Einhorn's Greenlight Capital and Nelson Peltz's Trian Fund Management, which posted gains of just 1.6 percent and 3.7 percent, respectively, last year.

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