Alaska Sold Berkshire, Apple, Verizon, and Broadcom Stock as 2019 Ended

Discussion in 'Wall St. News' started by dealmaker, Jan 12, 2020.

  1. dealmaker


    Alaska Sold Berkshire, Apple, Verizon, and Broadcom Stock as 2019 Ended
    By Ed Lin
    Jan. 11, 2020 7:00 am ET

    The Alaska Department of Revenue sold Berkshire Hathaway, Apple, Verizon, and Broadcom stock.Photograph by Alastair Pike/AFP/Getty Images

    Alaska hasan estimated 100,000 glaciers, but the state known as the Last Frontier doesn’t move at a glacial pace when investments are concerned.

    The Alaska Department of Revenue, which collects and invests public funds, cut back on holdings in some of America’s largest companies. It sold class B shares ofBerkshire Hathaway(ticker:BRKb),Apple(AAPL),Verizon Communications(VZ), andBroadcom(AVGO) in the fourth quarter. Notably, three are lagging behind the 1.1% gain in theS&P 500so far in January through Friday’s close. The departmentdisclosed the changes in a form it filedwith the Securities and Exchange Commission.

    The agency, which oversaw $7.7 billion in U.S.-traded equities at the end of 2019, didn’t respond to a request for comment.

    Berkshire Hathaway stock had a disappointing 2019, especially considering that Warren Buffett—regarded as one of the world’s savviest investors—serves as the conglomerate’s CEO. Class B shares of Berkshire stock managed only a 10.9% gain in 2019, about a third of the S&P 500’s 28.9% rise. Berkshire stock washammered by a dropin one of its largest investments,Kraft Heinzstock (KHC); the fall also dinged Buffett’s reputation as he helped to form the company by merging the former Kraft and Heinz.

    Alaska’s revenue department sold 36,753 Berkshire class B shares in the fourth quarter, cutting its investment to 359,613 shares. The stock is flat so far this year.

    The agency also sold 70,089 Apple shares in the fourth quarter, ending 2019 with 719,498 shares. In the first few trading days of 2020, Apple stock has surged 5.7%.

    Apple stock had a boffo 2019, with shares soaring 89% after a disappointing start kicked off by asurprise earnings warning. Shares of the iPhone maker also prevailed in a year in which tariffs threatened toharm Apple’s manufacturing process, and observers questioned ifconsumer demand had waned.

    Verizon stock managed only a 13.8% gain in 2019, hemmed in byanalyst downgradesthat opined thatupside was already priced inthe communications giant’s shares.Barron’snoted that Verizon underperformed peers in 2019 and couldcontinue to have a lackluster 2020, as well.

    The Alaskan agency sold 99,446 Verizon shares in the fourth quarter to end the period with 767,906 shares. It looks like a savvy move so far; with only seven trading days into 2020, Verizon stock has already lost 4.0%.

    Broadcom stock is also slipping in 2020, having lost 5.3% so far, after keeping pace with the S&P 500 last year with a 29% gain. We think the new year will be good for the chip maker asdemand for connected devices increases.

    Alaska’s revenue department sold 10,025 Broadcom shares in the last quarter of 2019, ending the year with an even 95,600 shares.

    Apart from the performance of the agency’s equity investments, Alaska’s revenue department has a growing source of funding from the taxation of marijuana, which has beenlegal there for adult recreational use since 2015. It collectedmore than $2 million in marijuana taxin October, the latest reported month.Pot taxes surged to $19.2 million in fiscal 2019ended June from $11.1 million the previous 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 toEd Linatedward.lin@barrons.comand follow@BarronsEdLin.
    Nobert likes this.
  2. What does the Alaskan DOR do when this stuff blows up? Do they budget in crazy returns each year?
  3. They probably hedge with puts
    athlonmank8 and murray t turtle like this.
  4. %%
    And plenty of forests +oil wells/royalties may help also............................................................:D:D,:D:D:D:D:D:D:D:caution::caution:
    nooby_mcnoob likes this.