South Korea’s sovereign-wealth fund bought AT&T, GE, and AMD stock in the first quarter, and dramatically raised its investment in Aurora Cannabis.
Photograph by Alejandro Cegarra/Bloomberg
South Korea’s sovereign-wealth fund made some big purchases of U.S.-traded stocks in the first quarter, a period marked by that country’s efforts to contain the spread of the latest coronavirus.
Korea Investment Corp. significantly increased its investments in AT&T (ticker: T), General Electric ( GE), and Advanced Micro Devices stock (AMD). The fund also put more money into marijuana stock Aurora Cannabis (ACB). KIC disclosed the stock trades in a form it filed with the Securities and Exchange Commission.
KIC, whose assets under management totaled $131.6 billion at the end of 2018, didn’t respond to a request for comment on the stock trades.
The fund bought 1.64 million more AT&T shares in the first quarter, ending the period with 6.69 million shares of the media and telecom giant.
AT&T stock slid 25.4% in the first quarter. In the second quarter through Friday’s close, it has slipped 2.9%. In comparison, the S&P 500 index, a measure of the broader market, fell 20% in the first quarter, but has gained 10.8% so far in the second.
AT&T CEO Randall Stephenson is stepping down on July 1. The company’s media and satellite-TV divisions are facing heightened challenges, although the wireless service seems somewhat insulated from the coronavirus-weakened economy. AT&T has committed to paying its dividend, although the company has withdrawn guidance.
GE stock also fell in the first and second quarters, down 28.5% and 30.9%, respectively.
Shares of the embattled manufacturing giant have recently fallen to a decades-low price and layoffs at GE have been piling up.
KIC bought 1.88 million more shares of GE to end the first quarter with 5.87 million shares.
The fund bought 308,770 additional shares of chip giant AMD in the quarter to lift its investment to 774,100 shares.
AMD stock slipped less than 1% in the first quarter, and in the second it has surged 19.2%.
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AMD cut guidance in late April, and investors had concerns that the demand for notebook chips wouldn’t continue. Rival Intel (INTC) is also facing the same skepticism.
Aurora Cannabis stock has crumbled this year, plunging 58.1% in the first quarter, but it is up 3.0% so far in the second.
The fund bought 260,540 additional Aurora Cannabis shares in the first quarter to end March with 286,928 shares of the pot grower.
As Aurora Cannabis stock was falling in mid-April, one analyst remained bullish. “Still, confidence could return if the company can show significant improvement in cash burn and [earnings before interest, taxes, depreciation, and amortization] over the next couple of quarters,” Cantor Fitzgerald analyst Pablo Zuanic wrote.
Strong fiscal-third-quarter numbers sent Aurora Cannabis stock surging Friday.
Switzerland’s central bank was also a big buyer of Aurora Cannabis stock in the first quarter.
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 edward.lin@barrons.com and follow @BarronsEdLin.
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