A Low-Volatility Advisor Bought Up AT&T, Verizon, and Occidental Stock. Here’s What It Sold.
Gateway Investment Advisers bought more AT&T and Verizon stock, initiated a position in Occidental Petroleum, and sold GE stock in the second quarter.
Timothy A. Clary/AFP/Getty Images
A large firm that specializes in low-volatility equity strategies recently made major changes in its stock investments.
Gateway Investment Advisers bought more AT&T (ticker: T) and Verizon Communications (VZ) stock, initiated a position in Occidental Petroleum (OXY), and lowered its investment in General Electric (GE) in the second quarter. The Cincinnati, Ohio-based advisor disclosed the trades, among others, in a form it filed with the Securities and Exchange Commission.
In response to a request for comment, Gateway said, “These trades were part of a routine rebalancing, and are not reflective of any forward-looking assessment of individual companies.”
Gateway manages $10.2 billion in assets. Its “low-volatility strategy seeks to capture the majority of the returns associated with equity market investments, while exposing investors to less risk than other equity investments,” according to Gateway’s website.
The advisor bought 301,532 more AT&T shares in the second quarter to end June with 1.9 million shares of the communications and media giant.
AT&T stock hasn’t been keeping up with the market year to date. Shares ended the first half of 2021 flat, and so far in July they have slipped 1.5%. The S&P 500 index, for comparison, surged 14.4% in the first half, and has gained 0.7% so far in July.
AT&T announced a megadeal in May to combine its media assets, including CNN, HBO, and Warner Bros., with those of Discovery (DISCA) into a new third entity that will be spun off or split off to shareholders. AT&T stock slid after the announcement; investors were dismayed by an expected dividend cut, but insiders bought up shares.
Gateway bought 130,586 additional Verizon shares to end the second quarter with 1.3 million shares of the communications giant. Verizon stock slid 4.6% in the first half, and has gained 0.8% so far in July.
Verizon’s first-quarter report in May was lackluster. Last month, Verizon agreed to sell its stake in digital publisher Complex Networks. Earlier this year, Verizon had agreed to sell most of its Yahoo and AOL assets.
Occidental stock rocketed 80.6% in the first half of the year, and so far in July it has slipped 17.0%.
Upbeat outlooks for oil prices lifted Occidental stock earlier in the year. Prices have risen, but remain volatile. We’ve noted that an oil bull has named Occidental as a favorite stock.
Gateway bought 316,873 Occidental shares in the second quarter; it hadn’t owned any at the end of March.
The advisor sold 238,313 GE shares to end the second quarter with 2.5 million shares of the conglomerate. GE stock rose 24.6% in the first half, and so far in July it has slipped 6.8%.
Barron’s reported earlier this month that GE stock seemed ready to see some catalysts. Wall Street seems upbeat on the shares. GE’s Larry Culp made our latest list of top CEOs. We credited him for facing “structural problems that had been put off for years,” as the stock more than doubled in a year.
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 [email protected] and follow @BarronsEdLin.
