Pershing Square Capital Management, the hedge fund firm founded by Bill Ackman, is facing losses from its holding in Chipotle after the burrito chain's stock tumbled on Tuesday on news that CEO Brian Niccol was jumping ship to Starbucks, according to a report by the Wall Street Journal.

Pershing Square played a significant role in recruiting Niccol to Chipotle over six years ago and holds a sizeable stake in the company. As of the end of Q1, the hedge fund owned approximately 37.2m Chipotle shares, valued at over $2bn based on Monday's closing price, according to FactSet.

Niccol has been credited with driving substantial gains in Chipotle’s stock during his tenure.

Despite Tuesday's drop, Chipotle remains a standout investment for Ackman’s firm. The stock was the top performer in Pershing's Square's main fund throughout 2023 and early 2024, as noted in the latest annual report.