Investor Ackman Advocates for Measured Approach to Fannie Mae’s Future

The debate surrounding the future of mortgage financier Fannie Mae has gained fresh momentum from prominent investor Bill Ackman. As markets remained closed for a holiday, attention turned to the detailed roadmap he has publicly presented, which cautions the Trump administration against a rushed privatization of the government-sponsored enterprise.

Central to the renewed discussion is Ackman's emphasized multi-stage proposal for returning Fannie Mae to private ownership. The Pershing Square CEO has reiterated that a premature return to public markets would be a strategic misstep, potentially undervaluing the company and destabilizing the U.S. mortgage landscape. He is championing a clearly defined, step-by-step process designed to methodically unlock shareholder value.

His outlined plan consists of four pivotal phases:

• Phase One – Official Acknowledgment: The U.S. Treasury Department would formally recognize that Fannie Mae has fully repaid its government bailout funds.
• Phase Two – Warrant Exercise: The government would then exercise its warrants, taking ownership of 79.9% of the company's shares.
• Phase Three – Relisting: Subsequently, the stock would relist on the New York Stock Exchange to establish a transparent market valuation.
• Phase Four – Slow Divestment: The Treasury would gradually sell down its stake over a five-year period.

This framework positions Ackman in direct opposition to scenarios involving an immediate initial public offering, which some investors had anticipated for early 2026. He has labeled his gradual plan the "best idea for 2026," suggesting the ideal timing for an IPO would be in the fourth quarter of that year.

Valuation Disparity and Share Price Potential

Current share valuation is heavily contingent on the implementation of potential reform measures. Trading on the over-the-counter market, Fannie Mae's stock is currently priced around $10.83, a level significantly below figures discussed under a successful privatization scenario.

Should investors sell immediately? Or is it worth buying Fannie Mae?

According to Ackman's model, consistent execution of this "slow and steady" approach could see the shares reach approximately $34 by the time of a planned late-2026 public offering. This would represent upside potential exceeding 200% from the current price.

However, this projected value critically depends on the federal government actually exercising its warrants. While this action would be dilutive for existing shareholders, it would simultaneously create the regulatory foundation necessary for the NYSE relisting.

The Perils of a Rushed Public Offering

Substantial risks accompany the identified opportunity. Legal and housing finance experts had previously noted that an IPO in 2025, given capital requirements, would have been "exceptionally ambitious." Ackman now explicitly warns against forcing a public listing and thereby risking a "failed public offering."

Investors must therefore weigh the likelihood of the government adopting his phased plan against a faster but potentially more uncertain exit path. At the current price level near $10.83, the market is already pricing in some probability of reform, yet volatility is expected to remain elevated until the regulatory framework is firmly established.

In the coming weeks, the reaction of the U.S. Treasury Department to these publicly presented proposals will move into focus and is likely to be a major influence on the stock's trajectory.