The New York State Teachers’ Retirement System (NYSTRS), one of the ten largest public retirement systems in the U.S., recently made strategic moves to increase its holdings in certain stocks that demonstrated strong growth in 2023.
During the fourth quarter, NYSTRS purchased shares of popular ride-hailing firm Uber Technologies and athleisure-apparel retailer Lululemon Athletica. At the same time, the pension reduced its position in industrial conglomerate Honeywell and expanded its investment in retailer Target. These transactions were disclosed in a filing with the Securities and Exchange Commission.
NYSTRS does not provide comments on individual stockholdings. With $137.2 billion in net assets as of June 30, the pension manages a substantial portfolio.
Uber experienced an exceptional surge in its stock price, outpacing the S&P 500 index with a remarkable 149% increase in 2023. This positive trend has continued into 2024, as Uber shares have risen by 11% compared to the index’s 4% uptick.
Last year, Uber achieved notable milestones, including its entry into the package-return market and its first-ever operating profit. However, the company’s most significant achievement was joining the esteemed S&P 500 index in December.
In the fourth quarter, NYSTRS acquired 1.87 million Uber shares, bringing its total holdings to 1.91 million by the end of 2023.
Additionally, NYSTRS demonstrated a similarly bold move by increasing its stake in Lululemon. The pension purchased 102,968 shares of the athleisure-apparel retailer, raising its total holdings to 105,719 shares at the close of the fourth quarter.
Uber Stock and Lululemon Partnership
Last year in October, shares of Lululemon, a retailer of athletic clothing, joined the S&P 500. During the same period, Lululemon entered into a partnership with home-fitness firm Peloton. Both companies are known for their high-end exercise gear, and this partnership marked their attempt to explore each other’s markets.
Lululemon faced some challenges when it provided disappointing guidance in early January. This caused a decline in its share value. However, by the end of the year, Lululemon shares had gained 60%. Unfortunately, in the current year, the shares have experienced a 10% decrease.
Honeywell’s Recent Performance
Honeywell stock has not been performing well recently. In 2024, its shares have fallen by 6.5%, which adds to the 2% loss from the previous year (2023). Despite these setbacks, Honeywell’s earnings have been strong since the unexpected change in CEO last year. The company’s fourth-quarter results, released on Thursday, were particularly positive.
Honeywell’s Acquisition and NYSTRS’s Shareholding
In December, Honeywell made an important acquisition. The company agreed to purchase Carrier Global’s security business for approximately $5 billion. This acquisition includes electronic locks for hotels and hospital chains.
During the fourth quarter of last year, NYSTRS, a pension fund, sold 52,000 Honeywell shares. As a result, the fund ended the year with 629,263 shares in its portfolio.
Target’s Performance and Closures
In terms of Target, NYSTRS added 35,200 shares to its portfolio during the fourth quarter of 2023. By the end of that year, the pension fund held 522,400 shares in Target.
Target experienced a 4% decline in its stock value in 2023. This negative trend has continued into 2024, with a further decrease of 2.2% so far.
One of the reasons contributing to Target’s challenges was a wave of in-store thefts in American cities, which led the company to announce closures in September. CEO Brian Cornell also mentioned in November that consumers were reducing their spending, even on food. Despite these difficulties, Target has managed to report higher-than-expected earnings.
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