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Generation Investment, chaired by former Vice President Al Gore, was loaded into Alibaba’s ADR and launched a stake in chip giant Intel.
Anthony Harvey / Getty Images for Paramount Pictures
The investment firm co-founded and chaired by former Vice President Al Gore has recently made some major changes to its US-listed portfolio.
Generation Investment Management materially increased its investment in
Participation of the Alibaba group
(ticker: BABA), started a participation in
Intel
(INTC) and cut stakes
Analog devices
(ADI) i
Palo Alto Networks
(PANW) in the second quarter. The firm disclosed the securities transactions, among others, in a form it submitted to the Securities and Exchange Commission.
Generation, which managed $ 36 billion in assets as of June 30, declined to comment.
The largest public fund of Generation under its management, Lombard Odier Funds-Generation Global, has been surpassing its benchmark, the
MSCI World Index,
for the current year and longer periods. The annualized return since the fund’s launch in November 2007 is 10.42%, compared to the index’s 6.93%.
Generation bought an additional 921,211 U.S. deposit receipts from Alibaba to end the second quarter with 3.9 million ADRs from Chinese Internet giant.
Alibaba’s ADRs fell 2.6% in the first half of the year, and so far in the third quarter they have fallen 30.3%. For comparison, the
S&P 500 Index
it increased by 14.4% in the first half and increased by 3.4% so far in the third quarter.
Alibaba and its partners have been hampered by Chinese measures to tighten regulations. In addition, Alibaba is feeling the consequences of allegations of sexual harassment after an employee reported that she was assaulted in her hotel room by a male superior. CEO Daniel Zhang responded by firing a group of executives and declaring the situation “a humiliation for all Ali Ali.” China last week announced a new privacy law, which attacked Alibaba and its partners. Alibaba’s ADRs have recently fallen to a pandemic low.
The firm started a position at Intel, buying 7 million shares of the chip giant. He had not owned them by the end of the first quarter. Shares of Intel rose 12.7% in the first half and so far in the third quarter they have fallen 7.4%.
In July, Intel reported strong second-quarter gains, but gross margins are falling. Intel CEO Pat Gelsinger told us in late July that one of the company’s past flaws was that “Intel was too arrogant.” Gelsinger plans aggressive moves and noted that the most important engineers who left Intel in recent years are returning. “They feel the mojo is back.” Aside from the chips, Intel this month revealed a position in cryptocurrency exchange
Coinbase
Global (COIN).
Shares of Analog Devices rose 16.5% in the first half, and so far in the third quarter, shares of the chip company have fallen 3.2%.
Last week, Analog Devices ’third-quarter fiscal report set records and followed a strong second fiscal quarter. Needham analyst N. Quinn Bolton raised its target price to $ 200 after the third-quarter report and maintained a buy rating. Bolton wrote in an investigation report that Analog Devices’ growth rate in the fourth fiscal quarter “is expected to slow despite the growth in arrears” in the third fiscal. The generation sold 634,685 shares of Analog Devices to end the second quarter with 4.9 million shares.
The firm sold 413,345 shares of Palo Alto to end June with 1.8 million shares of the security software firm. Palo Alto shares rose 4.4% in the first half and so far the third quarter has fallen 1.0%.
Analysts were bullish in Palo Alto earlier this year and earnings for the third fiscal quarter, ending April 30, were strong. Palo Alto will report on fiscal results for the fourth quarter after the market closed on Monday.
Inside Scoop is a common feature of Barron that covers the stock transactions of corporate executives and board members — the so-called privileged — as well as large shareholders, politicians, and other prominent figures. Due to their privileged reporting status, these investors are required to disclose securities transactions with the Securities and Exchange Commission or other regulatory groups.
Write to Ed Lin at [email protected] and follow @BarronsEdLin.