Swiss Bank Makes Major Stock Purchases of Intel, Disney, and AT&T, Sells AMD Shares

A large financial institution based in Switzerland recently invested heavily in chip stocks, as well as media and entertainment shares.

In the fourth quarter, Julius Baer of Zurich made some significant stock trades. They purchased shares of Intel (INTC–6.41%), Walt Disney (DIS–0.15%), and AT&T (T–0.25%), and sold the majority of their investment in Advanced Micro Devices (AMD+0.32%). This information was disclosed in a form that was filed with the Securities and Exchange Commission.

The financial institution declined to provide any information regarding specific investments. As of October, the bank had a total of $470 billion in assets.

In 2022, Intel's stock experienced a significant decrease of 49%, compared to the S&P 500 index's 19% drop. In 2023, Intel's stock has seen a 6.5% increase, while the index has risen 6.0%. Julius Baer purchased an additional 21,715 shares of Intel at the end of the fourth quarter, bringing their total to 198,392.

Intel's fourth-quarter report and financial forecasts, released on Thursday, were not up to par. Analysts noted the "stunning" magnitude of the deterioration. With the continuing decline in demand for PCs, Intel and AMD stock targets have seen big cuts. When Intel reported their second-quarter earnings, they missed the consensus estimate of 69 cents per share by a mile. The stock dropped further when their guidance issued last year was also weaker than expected. Job cuts remain a possibility.

On Friday, a Wall Street analyst commented on the severity of the situation, noting that it was "stunning." Unfortunately, there is no simple solution for the semiconductor company.

Throughout the year, the number of personal computers shipped has decreased. An analyst from Bernstein's semiconductor division has expressed concern about the potential impact on the stock of two major chip manufacturers.

The semiconductor firm revealed second-quarter adjusted earnings per share of 29 cents, which was significantly lower than the consensus estimate of 69 cents among analysts monitored by FactSet.

The manufacturer of semiconductors announced better-than-anticipated adjusted per-share earnings and revenue that exceeded expectations.

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In 2022, Disney stock experienced a 44% decrease, however, in the current year, the shares have increased by 26%. Julius Baer purchased an additional 36,617 Disney shares, bringing their total to 359,185 by the end of 2022.

In November, Disney CEO Bob Chapek wrote in an internal memo that layoffs were likely, along with other cost-cutting measures. By the end of the month, Bob Iger had taken over as CEO, replacing Chapek. In January, activist investor Nelson Peltz made his presence known at Disney. His criticisms focused on the streaming business, which had seen large losses, and he suggested that cost-cutting may not be enough to fix the problem. He argued that a longer-term change throughout the streaming industry was necessary, which would take time.

The company has devised a plan to assess their expenditures across all departments in light of the significant losses incurred in their streaming sector.

Bob Iger is taking back the reins of Disney following the resignation of CEO Bob Chapek.

The activist investor has identified many issues with Disney, but the most significant one - Disney+ - may require more than just cost-cutting. It may necessitate a shift in the streaming industry that will take some time to achieve.

In 2022, AT&T stock only dropped 1% when taking into account the merger of its media assets with Discovery to form Warner Bros. Discovery (WBD). This year, AT&T shares have seen an 8.4% increase. The bank purchased an additional 112,078 shares, bringing their total to 759,763 shares of the telecom giant.

At the beginning of this month, AT&T announced a successful fourth quarter, with an increase in wireless customers and a charge related to its landline services. Pascal Desroches, the Chief Financial Officer, stated that the security of the dividend is very high. The telecommunications company reported 61 cents in adjusted earnings on revenue of $31.3 billion for the fourth quarter, surpassing expectations.

The telecommunications firm announced 61 cents in adjusted profits on sales of $31.3 billion for the fourth quarter.

AMD's third quarter, reported on November 1, was not as strong as investors had hoped. This caused the stock to rise, as it could have been worse. People are now wondering when the company and the semiconductor-manufacturing sector will experience a rebound. CEO Lisa Su told Barron's at the start of 2023 that AMD was focusing on artificial intelligence.

Su stated that "AI has been around for quite some time, but we're at an inflection point, touching all of our technologies, from chips for consumer devices up to the largest chips we build for data centers. You need AI capability in every one of those devices."

Investors are curious to find out when the company and the semiconductor-manufacturing industry will experience a recovery.

According to AMD Chair and CEO Lisa Su, the world is at a pivotal moment for artificial intelligence, despite the fact that the company is facing a difficult 2023.

In 2022, AMD's stock experienced a significant drop of 55%, however, in the current year, the shares have risen by 16%. Julius Baer sold 788,875 AMD shares, reducing their investment to 71,364.

Barron's regularly publishes a feature called Inside Scoop, which covers stock transactions made by corporate executives, board members, large shareholders, politicians, and other well-known figures. These individuals are required to report their stock trades to the Securities and Exchange Commission or other regulatory bodies due to their privileged status.