United Airlines Rises on Strong Earnings while Coinbase Follows Bitcoin Lower
Last week, the Opportunity Equity Strategy's representative account declined -2.02%, outperforming the S&P 500’s -3.04% fall. (Exhibit 1). The strategy ended the week up 4.23% YTD, 35 basis points behind the S&P 500.Exhibit 1: Performance of Opportunity Equity Representative Account Net of Fees, Versus S&P 500, Through 4/19/241
| Time Period | Opportunity Equity Representative Account | S&P 500 |
| Last Week (4/12 - 4/19) | -2.02% | -3.04% |
| MTD | -7.05% | -5.40% |
| QTD | -7.05% | -5.40% |
| YTD | 4.23% | 4.58% |
| 1 Year | 32.59% | 21.45% |
| 5 Year | 7.56% | 13.20% |
| 10 Year | 7.99% | 12.37% |
| Inception (annualized since 6/26/00) | 7.11% | 7.31% |
Source: Bloomberg, Patient Capital Management.
United Airlines Holdings, Inc. (UAL) rose through the 50-day, 100-day, and 200-day moving averages after announcing a revenue and adjusted EPS surprise, coming in at $12.53B vs. consensus of $12.44B and -$0.15 in adjusted EPS vs. consensus of -$0.57. The company reiterated 2024 adjusted EPS guidance ahead of consensus of $9 - $11 per share. Due to fleet changes, the company is now guiding for $6.5 in CAPEX vs. consensus of $7.0B. Morgan Stanley increased their price target from $75 to $80 (56% upside), while JP Morgan increased their price target from $73 to $80 (56% upside).
OneMain Holdings, Inc. (OMF) rose through the 50-day and 100-day moving averages after the company announced early-stage delinquencies are down on a year over year basis from year-end levels. This supports the company’s expectations that net charge offs should peak in the first half of 2024.”
Canada Goose Holdings, Inc. (GOOS) rose on limited news.
Mizuho increased their price target on Energy Transfer LP (ET) from $18 to $19 (20% upside).
Delta Air Lines, Inc. (DAL) continued to rise following their strong earnings last week.
Exhibit 2: Significant2 Contributors to Opportunity Equity Representative Account Performance, 4/12/24 - 4/19/24
| Name | Type | Net Return |
| United Airlines Holdings, Inc. | Equity | 22.9% |
| OneMain Holdings, Inc. | Equity | 4.2% |
| Canada Goose Holdings Inc. | Equity | 5.8% |
| Energy Transfer LP | Equity | 2.3% |
| Delta Air Lines, Inc. | Equity |
1.5% |
Source: Patient Capital Management. See below for additional information.
All five of our top detractors for the week fell amid the broader tech sell-off.
Nvidia Corp (NVDA) fell through the 50-day moving average. Evercore ISI initiated coverage with an outperform rating and $1160 price target (52% upside).
Amazon.com Inc. (AMZN) fell through the 50-day moving average. Truist increased their price target on Amazon from $195 to $216 (24% upside) while Stifel increased their price target from $200 to $224 (28% upside).
Coinbase Global, Inc. (COIN) fell through the 50-day moving average, following bitcoin prices lower throughout the week. Goldman Sachs increased their price target from $282 to $295 (40% upside).
Meta Platforms, Inc. (META) fell through the 50-day moving average after debuting their latest AI assistant across WhatsApp, Instagram, Facebook, and Messenger. The assistant was built using the company’s latest LLM, Meta Llama 3, which also made its debut last week. Citi increased their price target from $525 to $590 (23% upside), while Truist increased their price target from $525 to $550 (14% upside).
Peloton Interactive, Inc. (PTON) fell, hitting an all-time low since being a public company on Friday.
Exhibit 3: Significant2 Detractors from Opportunity Equity Representative Account Performance, 4/12/24 - 4/19/24
| Name | Type | Net Return |
| Nvidia Corp | Equity | -13.6% |
| Amazon.com, Inc. | Equity | -6.2% |
| Coinbase Global, Inc. | Equity | -14.1% |
| Meta Platforms, Inc. | Equity | -6.0% |
| Peloton Interactive, Inc. | Equity | -14.6% |
Source: Patient Capital Management. See below for additional information.
As of prior week's market close unless otherwise stated.
1The performance figures for the representative Opportunity Equity account reflect the deduction investment management fees and certain other expenses. Returns greater than 1 year are annualized.
Patient Capital Management, LLC completed its acquisition of the Opportunity Equity Strategy from Miller Value Partners, LLC on May 26, 2023. Patient Capital Management served as the investment adviser to the Opportunity Equity Strategy for the majority of the week referenced herein. Additionally, prior versions of this weekly blog posting refer to Miller Value Partners as investment adviser to the Opportunity Equity Strategy.
For additional information about Opportunity Equity Strategy performance, please click on the Opportunity Equity Strategy Composite Performance Disclosure. Past performance is no guarantee of future results.
2Significant Contributors and Detractors are based on holdings that had the greatest effect on representative account performance for the week. Holdings that have been in the portfolio since the end of the most recent calendar quarter are identified by name. The net return shown above for each individual security represents the change in market price of the security during the week, according to a third-party pricing service, or for the partial period held in the portfolio during the week. Net returns also include any purchases or sales that were made during the week. For information on how Contributor/Detractor data were calculated and a list showing the contribution to the Strategy’s weekly performance of each investment held at such quarter end, contact us.
Any views expressed are subject to change at any time, and Patient Capital Management disclaims any responsibility to update such views. There is no guarantee that market trends discussed herein will continue. The information presented should not be considered a recommendation to purchase or sell any security and should not be relied upon as investment advice. It should not be assumed that any purchase or sale decisions will be profitable or will equal the performance of any security mentioned. Past performance is no guarantee of future results, and there is no guarantee dividends will be paid or continued. References to specific securities are for illustrative purposes only. Portfolio composition is shown as of a point in time and is subject to change without notice. Content may not be reprinted, republished or used in any manner without written consent from Patient Capital Management.
©2023 Patient Capital Management, LLC
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