The California Public Employees’ Retirement System (Calpers), the largest public pension in the U.S., has made significant changes to its investment portfolio. In the second quarter, Calpers increased its holdings of volatile stocks while also reducing its stake in chip manufacturer Intel (INTC). The pension recently filed a form with the Securities and Exchange Commission, disclosing these stock trades and others.

Although Calpers prefers not to comment on its individual holdings, it manages a substantial $467 billion in assets. In its portfolio adjustments, Calpers acquired more shares of Roblox (RBLX), Lucid Group (LCID), and HP (HPQ). However, it decreased its holdings in Intel by approximately one-fifth.

The investment in Roblox seems promising as the stock saw a 42% surge in the first half of 2023, outperforming the 16% rise in the S&P 500 index. In contrast, Roblox shares have experienced a 26% decline in the third quarter, while the index has remained stable. It is worth noting that Roblox faced challenges in 2022, with its stock plummeting by 72%, while the S&P 500 dropped 19%.

Roblox's latest quarterly reports, both the one released last week and the one in May, have both disappointed investors. The share price decline following the most recent quarter wiped out nearly all of the gains made in 2023. Additionally, in May, the company faced criticism from a children’s advertising watchdog for allegedly failing to inform users that some game content was actually advertisements. At the time, Roblox defended itself, stating that it surpasses the necessary legal obligations to ensure a safe environment for all users.

Despite the recent challenges faced by Roblox, Calpers purchased an additional 276,271 shares in the second quarter, bringing its total to 831,093 shares as of the end of June. However, the value of these shares has declined by approximately $9 million since June 30, from $33.5 million to $24.8 million.

In the case of Lucid Group, Calpers acquired an additional 170,435 shares, resulting in a total of 1 million shares at the end of the second quarter.

Lucid Stock Faces Challenges

Lucid stock, which experienced a significant decline in 2022, has been striving to recover from its 52-week intraday low in June. However, recent price cuts and a disappointing second-quarter report have put pressure on the company's shares.

Selling Higher-Priced Cars: A Solution for Lucid?

Analysts suggest that Lucid may find it easier to regain momentum if it shifts its focus towards selling cars priced at $400,000 instead of $100,000.

Mixed Performance for Lucid and HP Stocks

Lucid stock remained flat in the first half of 2023 following an 82% plunge in the previous year. In the third quarter, shares have experienced a 3.6% decline.

On the other hand, HP stock witnessed a 14% increase in the first half of the year, offsetting last year's 29% drop. In the third quarter, HP shares have risen by 6.7%.

HP's Earnings Report Falls Short

HP's fiscal second-quarter earnings report, released in May, failed to meet analysts' expectations. While PC shipments remained weak during the second quarter, both HP and Apple (AAPL) managed to outperform the industry. HP's CEO Enrique Lores anticipates a rebound in PC demand following a decline at the end of the pandemic surge.

Financial Moves by Calpers

During the second quarter, Calpers bought an additional 842,460 HP shares, bringing its total holdings to 2.9 million shares. Simultaneously, Calpers sold 2 million Intel shares, ending June with 7.8 million shares.

Intel Stock Makes a Comeback

Intel's stock experienced a notable recovery in the first half of 2023, surging by 26.5% after a significant decline of 49% in the previous year. In the third quarter, shares have risen by 4.3%.

Intel's Need for Focus on Artificial Intelligence

Intel CEO Pat Gelsinger has been personally acquiring shares this year, while the company itself has been reducing investments in on-demand video products and a flying car manufacturer. Some industry experts believe that Intel should prioritize its focus on artificial intelligence as a means for future growth.