The largest public pension in the U.S. by assets just made major changes in its investment portfolio.
The California Public Employees' Retirement System bought more Apple (ticker: AAPL), Tesla (TSLA), and Walt Disney (DIS) stock, and sold about a fifth of its stake in Walmart (WMT) in the fourth quarter. Calpers disclosed the stock trades, among others, in a form it filed with the Securities and Exchange Commission.
Calpers declined to comment on the investment changes. It manages about $460 billion in assets.
Apple stock fell 27% in 2022, compared with a 19% drop in the S&P 500 index. Shares of the iPhone maker have gained 16% so far this year while the index has gained 6.5%. Calpers bought 8 million additional Apple shares in the fourth quarter to raise its stake to 43 million shares.
Upbeat analyst reports helped lift Apple shares in early January. The stock was rising steadily by midmonth when Apple unveiled a refresh of its computers with a new chip. A disappointing fiscal-first-quarter report on Feb. 2 put Apple stock's rise on ice.
Tesla stock has far outpaced Apple stock's gains so far this year, surging 60%, following a plunge of 65% in 2022.
Barron's had suggested buying shares of the electric-vehicle maker at the beginning of this year. Tesla slashed prices for EVs worldwide in mid-January. In February, however, the company raised prices for its Model Y after the Internal Revenue Service made an adjustment in the EV's category.
Calpers bought 675,683 additional Tesla shares to raise its investment to 6.4 million shares as of the end of 2022.
The pension bought 1.4 million more Disney shares in the fourth quarter to lift its stake to 5.5 million shares.
In the past week, Disney reported a strong first quarter, punctuated by a smaller-than-expected drop in paid subscribers to the Disney+ streaming service, and a reinstated dividend, which activists have wanted. The company also announced it would lay off 7,000 employees. Disney activist that had been agitating for change called off its proxy fight after the latest changes. In November, Bob Iger returned to Disney as its CEO, replacing his replacement, Bob Chapek, after just under a year of being away. One
Disney stock slid 44% in 2022, and so far this year shares are up 24%. Walmart stock slipped only 2% last year, and so far in 2023 shares are up 1.4%.
In January, Walmart responded to a shortage of workers by raising starting wages for hourly workers to $14 to $19 an hour, up from $12. The outlook for retail in the face of inflation hasn't been great as of late, yet Walmart plans to open 30 more Sam's Club stores that are larger than current locations.
Calpers sold 1.9 million Walmart shares to cut its stake to 7.2 million shares as of the end of 2022.
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.
