Sometimes politicians seem to have an uncanny ability to beat the market. In recognition of this, many investors outside of the Beltway pay particular attention to the trades of our senators and representatives — like those of Rep. Marjorie Taylor Greene, R-Ga.
Last week, Greene submitted a regulatory filing that revealed six recent stock purchases: Advanced Micro Devices (NASDAQ: AMD), Apple (NASDAQ: AAPL), Caterpillar (NYSE: CAT), Charles Schwab (NYSE: SCHW), Kinder Morgan (NYSE: KMI), and Southern Company (NYSE: SO). It’s not clear how much Greene invested in each of the stocks, though each transaction was valued between $1,001 and $15,000. Greene sits on the Oversight and Reform Committee as well as the Homeland Security Committee.
What to know about Greene’s recent purchases
While Greene hasn’t provided an explanation regarding the motivation behind her recent stock purchases, there are some likely reasons why she clicked the buy button on some of these names. For one, Advanced Micro Devices and Apple are leading tech stocks that provide exposure to artificial intelligence (AI) — something that’s red-hot right now.
Semiconductor stock AMD is making a greater push into AI with its new graphic processing units (GPUs), an area where Nvidia is currently the reigning champion. Apple is attempting to broaden its AI reach in several ways, including its development of a new system for advancing large language models called ReALM that could greatly enhance Siri’s functionality.
Three infrastructure stocks also found their way onto Greene’s buy screen. There are a couple of reasons why she may have been motivated to acquire these familiar names. For one, many projects are taking shape in response to the Bipartisan Infrastructure Law that was passed in 2021. This will provide a strong tailwind for heavy machinery equipment powerhouse Caterpillar over the next few years. The company reported a $400 million quarter-over-quarter increase in its backlog during its first-quarter 2024 financial results presentation. Also, Caterpillar has demonstrated a long-running commitment to shareholders. After hiking its dividend for the past 30 consecutive years, Caterpillar also began a $3.5 billion share buyback plan.
As a leading pipeline stock, Kinder Morgan is also poised for growth from infrastructure spending. The company projects natural gas demand will grow about 19% from 2023 through 2030, and it has about $2.5 billion in natural gas projects in its backlog — an figure that it expects to continue growing. Like Caterpillar, Kinder Morgan is also a compelling income stock, offering a 5.8% forward dividend yielding.
Southern Company stands as yet another infrastructure stock that Greene is relying on to help build a better portfolio. A familiar name to the representative from Georgia, the utility is headquartered in Atlanta. Recently commencing operations at its new nuclear power plant Plant Vogtle Unit 3, Southern Company provides electric service in the Southeast and natural gas service to 4.4 million customers in 10 states. For 77 straight years, Southern Company has paid a dividend, raising it for the last 23 consecutive years.
Retail brokerage heavyweight Charles Schwab rounds out Greene’s latest buys. Coming off a strong start to 2024, the financial stock provides Greene with some diversification, and it also provides more passive income, offering a 1.3% forward-yielding dividend.
Should you mimic Greene’s buys?
While it’s a worthwhile exercise to check in and see what stocks politicians are adding to their holdings, it’s foolhardy to blindly follow their stock picks. There are certainly bull cases to be made for all of the stocks that Greene recently bought, but there are also skeptics who can present bear cases for the stocks. Consequently, investors must do their own due diligence and decide if the individual stocks are right for them.
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Charles Schwab is an advertising partner of The Ascent, a Motley Fool company. Scott Levine has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Advanced Micro Devices, Apple, Charles Schwab, Kinder Morgan, and Nvidia. The Motley Fool recommends the following options: short June 2024 $65 puts on Charles Schwab. The Motley Fool has a disclosure policy.
Marjorie Taylor Greene Just Loaded Up on Stocks: Here Are the 6 She Bought was originally published by The Motley Fool
