Canada’s largest pension made major changes in its U.S.-listed investments.
The investment board of the Canada Pension Plan slashed positions in Tesla (ticker: TSLA), General Electric (GE), and AT&T stock (T) in the third quarter. The board of the CPP also purchased Citigroup stock (C). The pension disclosed the stock trades, among others, in a form it filed with the Securities and Exchange Commission.
The CPP had no comment on the stock transactions. The pension managed assets of $330 billion as of June 30.
The CPP sold the equivalent of 367,499 post-split Tesla shares in the third quarter to end September with 74,441 shares of the electric-car maker. Tesla stock split 5-for-1 at the end of August.
Tesla stock has rocketed nearly 500% year to date through Friday’s close, and it has surged 14.1% in the fourth quarter. By comparison, the S&P 500 index, a broad measure of the market, has risen 10.1% this year, including a 5.8% gain in the fourth quarter.
Speaking of the index, Tesla stock is joining the S&P 500, effective Dec. 21. The company’s earnings have been strong. Recently, CEO Elon Musk has tested both positive and negative for the coronavirus.
The pension sold 2.6 million GE shares in the third quarter to end the period with 1.7 million shares of the conglomerate.
GE stock’s year-to-date loss is 18.5%, but that includes a 57% rally since the end of the third quarter.
GE stock has surged on the potential for a coronavirus vaccine, which would be a shot in the arm for its aerospace business. Analysts have been upbeat on the shares, and GE’s earnings have been strong.
AT&T stock has also lost 27.5% of its market value this year, and has been essentially flat in the fourth quarter.
We’ve noted that the lofty dividend yield—more than 7%—on AT&T stock looks safe. Slumps at the DirecTV and Warner Bros. units cut into the latest quarter’s revenue and profit. Last week, AT&T said it reached a deal for its HBO Max streaming service to be available through Amazon.com (AMZN) devices.
CPP sold 4.2 million AT&T shares in the third quarter, cutting its investment to 2.8 million shares.
The pension bought 800,000 additional Citigroup shares to end September with 3.7 million shares of the banking giant.
Citigroup stock has tumbled 35% year to date, including a 20% rally in the fourth quarter.
In October, the bank was fined $400 million for deficiencies in its risk-management controls. Citigroup topped estimates in the latest quarter. Recently a company director made the largest open-market purchase of stock by a Citigroup insider in years.
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@example.com and follow @BarronsEdLin