SOFI Rises on Positive MPL Data while NVDA Falls Despite Strong Earnings
Last week, the Opportunity Equity Strategy’s representative account fell -0.78%, underperforming the S&P 500’s 0.27% rise. (Exhibit 1). The strategy ended the week up 13.12% YTD, 641 basis points behind the S&P 500.Exhibit 1: Performance of Opportunity Equity Representative Account Net of Fees, Versus S&P 500, Through 8/30/241
| Time Period | Opportunity Equity Representative Account | S&P 500 |
| Last Week (8/23 - 8/30) | -0.78% | 0.27% |
| MTD | -0.37% | 2.43% |
| QTD | 2.62% | 3.67% |
| YTD | 13.12% | 19.53% |
| 1 Year | 27.07% | 26.96% |
| 5 Year | 10.94% | 15.92% |
| 10 Year | 7.91% | 12.98% |
| Inception (annualized since 6/26/00) | 7.36% | 7.79% |
Source: Bloomberg, Patient Capital Management.
SoFi Technologies, Inc. (SOFI) rose on July’s positive marketplace lending data (MPL). MPL refers to lending through fintech platforms rather than traditional banks. Jefferies reported MPL loan origination has grown from a trough of $1.9B in December ’23 to $3.1B in July ’24 while delinquencies came in at 3.38%, down 39bps YoY.
General Motors Co (GM) continued to rise following their announcement last week regarding the company’s multiyear partnership between Cruise and Uber Technologies.
Royalty Pharma plc (RPRX), Delta Air Lines, Inc. (DAL), and IAC Inc. (IAC) all rose on limited news.
Exhibit 2: Significant2 Contributors to Opportunity Equity Representative Account Performance, 8/23/24 - 8/30/24
| Name | Type | Net Return |
| SoFi Technologies, Inc. | Equity | 6.2% |
| General Motors Co | Equity | 2.5% |
| Royalty Pharma plc | Equity | 3.0% |
| Delta Air Lines, Inc. | Equity | 2.7% |
| IAC Inc. | Equity | 1.6% |
Source: Patient Capital Management. See below for additional information.
Nvidia Corp (NVDA) fell through the 50-day moving average despite delivering revenue of $30.0B vs. $28.8B expected and EPS of $0.67 vs. $0.61 expected. The beat was primarily driven by data center revenue, coming in at $26.3B (+156% YoY) vs. $25.3B (+145% YoY) expected. The company also announced approval for an additional $50B in share repurchase authorization (~2% shares outstanding). Bank of America increased their price target from $150 to $165 (38% upside).
Coinbase Global, Inc. (COIN) fell through the 200-day moving average, following Bitcoin lower throughout the week.
S4 Capital plc (SFOR LN) fell on limited news.
Morningstar increased their price target for Green Thumb Industries Inc. (GTBIF) from $24.00 to $24.44 (152% upside). The Drug Enforcement Administration (DEA) set a hearing date of December 2nd for the rescheduling of marijuana from a Class 1 to Class 3 drug.
Exhibit 3: Significant2 Detractors from Opportunity Equity Representative Account Performance, 8/23/24 - 8/30/24
| Name | Type | Net Return |
| Nvidia Corp | Equity | -7.7% |
| Coinbase Global, Inc. | Equity | -13.3% |
| S4 Capital plc | Equity | -13.0% |
| Green Thumb Industries Inc. | Equity | -8.9% |
| New Security* | Equity | -4.4% |
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.
©2024 Patient Capital Management, LLC
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