Pershing Square Inc. experienced a sharp downward retracement as intense profit-taking and mean-reversion pressure took hold following a rapid multi-week rally. The alternative asset manager had recently surged toward new highs on optimism surrounding the expansion of its permanent-capital platform, including the seeding of Pershing Square Ventures. However, after the stock ran up significantly in a brief timeframe, momentum investors quickly moved to lock in gains, triggering heightened intraday volatility and selling pressure across the session.

A major fundamental catalyst behind the pullback is the pronounced gap between market trading levels and institutional analyst valuations. Consensus price targets on Wall Street remain set…