A contrarian investment manager recently made some big changes in its U.S.-traded investments as the markets were roiled by the coronavirus pandemic.
Montreal-based Hexavest slashed holdings in
(INTC), and Walt
(DIS). It also initiated a position in
(ORCL). Hexavest disclosed the trades, among others, in a form it filed with the Securities and Exchange Commission.
Hexavest, which managed $5.7 billion in U.S.-traded assets as of March 31 and is 49%-owned by
(EV), didn’t respond to a request for comment on its investment changes.
The firm says on its site it has a “tendency to take contrarian positions.” Hexavest’s U.S. equities strategy slid 9.59% year to date through Feb. 29, in Canadian dollars, compared with a 5.04% drop in the
index, a measure of the broader market, and the strategy’s benchmark. We noted earlier in the year that Hexavest’s strategy had come up short against the index in recent years.
Apple stock slid 13.4% in the first quarter, while the S&P 500 slid 20%. In the second quarter, the iPhone maker’s shares and the index both gained 11.2% through Friday’s close. We’ve noted that analysts are divided about the prospects for Apple shares.
Hexavest sold 226,858 Apple shares in the first quarter to end March with 335,744 shares.
The firm trimmed its investment in chip giant Intel by 792,296 shares to end the quarter with 1,059,178 shares.
Intel stock slipped 9.6% in the first quarter, and in the second quarter it has surged 11.5%. Intel has benefited from more laptop and data-center demand as many office workers continue to work from home.
Disney stock crumbled 33% in the first quarter, but has managed a 10.4% rise in April. We noted that one analyst thinks the entertainment and media giant’s U.S. amusement parks could reopen in June. The Disney+ streaming service had a strong debut, which was a silver lining to the many challenges presented by the coronavirus pandemic.
Hexavest sold 381,678 Disney shares in the first quarter to lower its investment to 471,040 shares.
The investment manager also initiated a position in Oracle stock, buying 1.1 million shares of the software giant in the first three months of 2020.
Shares slipped 7.8% in the first quarter, and in April Oracle stock has wiped out that loss and then some by surging 13.0%. We have noted that Oracle recently saw a large insider purchase of stock on the open market. A J.P. Morgan analyst thinks the shares are a bargain.
Inside Scoop is a regular Barron’s feature covering stock transactions by corporate executives and board members—so-called insiders—as well as large shareholders, politicians, and other prominent figures. Due to their insider status, these investors are required to disclose stock trades with the Securities and Exchange Commission or other regulatory groups.
Write to Ed Lin at firstname.lastname@example.org and follow @BarronsEdLin.
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