Freddie Mac Shares: A Potential Path to the NYSE Gains Focus

Freddie Mac US3134003017

The ongoing conservatorship of Freddie Mac, the government-sponsored enterprise (GSE), is back in the spotlight following a new proposal from a prominent investor. Bill Ackman of Pershing Square has outlined a potential expedited path that diverges from conventional expectations, centering on a direct uplisting to the New York Stock Exchange.

In recent comments, Bill Ackman argued that a traditional initial public offering (IPO) for Freddie Mac and its sibling GSE Fannie Mae is neither "feasible nor desirable" in the near term. His alternative is a straightforward uplisting of the existing common shares from over-the-counter (OTC) markets to the NYSE. Ackman contends this move could be executed within a matter of weeks. He estimates the combined valuation of the two GSEs at approximately $400 billion, with the U.S. government's stake valued at roughly $300 billion.

This suggestion emerges amid reports that the Trump Administration and the Federal Housing Finance Agency (FHFA), led by Director William Pulte, are evaluating opportunistic paths toward privatization, potentially by late 2026. However, any comprehensive release from conservatorship or merger would require high-level political and regulatory decisions.

Market Performance and Economic Backdrop

Freddie Mac's stock closed its latest session at $10.35, marking a daily gain of 2.07%. Over the past year, the equity has demonstrated significant volatility and growth, trading within a 52-week range of $3.18 to $14.99 and posting a one-year performance of +207.12%.

The fundamental environment for the housing market is showing signs of improvement. Freddie Mac's own Primary Mortgage Market Survey (PMMS) recently reported the average rate for a 30-year fixed mortgage fell to 6.15%, its lowest level in over a year. This decline from the 7% peaks seen in 2024 could stimulate refinancing and purchase activity, thereby positively impacting Freddie Mac's guarantee business. The company's chief economist, Sam Khater, called this trend a "welcome sign" for the U.S. housing market in 2026.

Analyst Perspectives: Cautious Timelines

While Ackman's proposal suggests a swift timeline, institutional analysts express more caution regarding the schedule for a full resolution. In a January 2 research note, Wedbush analyst Henry Coffey outlined several potential capitalization and release pathways:
- Path A: Capital building exclusively through retained earnings (estimated duration: 8 years).
- Path B: Conversion of the Senior Preferred stock into common shares.
- Path C: Declaring the Senior Preferred stock fully repaid (noted by Wedbush as the preferred route).

Coffey acknowledged a potential exit scenario by fiscal year 2026 is possible but warned that political or regulatory delays could push a complete privatization out to 2033. Investors are currently weighing the short-term upside potential of an NYSE listing against the substantial hurdles required for a final release by Congress or the executive branch.

Governance and Forward Catalysts

The complex ownership structure under conservatorship was highlighted in a December 17, 2025 SEC filing, which showed that CEO Kenny M. Smith reported no directly held common shares.

The immediate market trigger is likely the forthcoming FHFA decision regarding Director Pulte's ongoing review of a potential 5 percent stock offering. Media reports and Ackman's commentary suggest a political decision could materialize by the end of 2026. However, as analysts note, the journey to full privatization may extend far beyond that, depending on the chosen capitalization path. Until then, Freddie Mac's shares are expected to remain highly reactive to regulatory developments and political signals from Washington.