Opportunity Equity Weekly Update for 11/8/2024 – 11/15/2024

Coinbase Jumps in Sympathy with Bitcoin while IAC Falls Despite a Topline Beat

Last week, the Opportunity Equity Strategy’s representative account fell -2.03%, outperforming the S&P 500’s -2.05% loss. (Exhibit 1). The strategy ended the week up 26.66% YTD, 210 basis points ahead of the S&P 500.

Exhibit 1: Performance of Opportunity Equity Representative Account Net of Fees, Versus S&P 500, Through 11/15/24¹

Time Period	Opportunity Equity Representative Account	S&P 500
Last Week (11/8 - 11/15)	-2.03%	-2.05%
MTD	5.02%	2.97%
QTD	8.48%	2.03%
YTD	26.66%	24.56%
1 Year	46.90%	32.22%
5 Year	10.06%	15.29%
10 Year	8.91%	13.20%
Inception (annualized since 6/26/00)	7.79%	7.90%

Coinbase Global, Inc. (COIN) reached a new 52-week high, following Bitcoin’s 20% jump. Bank of America raised their price target from $214 to $365 (19% upside). They are optimistic on the post-election cryptocurrency environment and forecast a steady adoption curve moving forward. JMP believes the proposed strategic bitcoin reserve is the largest potential driver for the company. The plan entails the US government purchasing 200K coins over the next 5 years (~5% of the total bitcoin supply). JMP does not think this is priced into the stock and raised their price target from $320 to $400 (31% upside).

Kosmos Energy Ltd. (KOS) rose despite Brent’s -3.83% fall. Bernstein lowered their price target from $4.01 to $4.00 (3% upside), and maintained their market perform rating. 

SoFi Technologies, Inc. (SOFI) reached a new 52-week high on limited news.

Jefferies highlighted Delta Air Lines, Inc. (DAL) as one of their top picks. They believe the company’s loyalty program and maintenance repair and operations (MRO) business are worth $50B alone, a 22% premium over the company’s current market cap.

Barclays increased their price target on United Airlines Holdings, Inc. (UAL) from $75 to $150 (65% upside). 

Exhibit 2: Significant² Contributors to Opportunity Equity Representative Account Performance, 11/8/24 - 11/15/24

Name	Type	Net Return
Coinbase Global, Inc.	Equity	13.0%
Kosmos Energy Ltd.	Equity	7.2%
SoFi Technologies, Inc.	Equity	4.8%
Delta Air Lines, Inc.	Equity	4.9%
United Airlines Holdings, Inc.	Equity	4.2%

IAC Inc. (IAC) fell through the 50-day, 100-day, and 200-day moving averages despite posting revenue of $939M vs. $922M expected and a significant EBIT beat of $16.3M vs. $-2.8M expected. EPS came in a $-2.93 vs. -$0.08 expected but was primarily driven by unrealized losses from the company’s 22% stake in MGM Resorts. IAC announced their plans to shift to a more streamlined portfolio. This involves potentially spinning off their Angi asset. The company raised their FY24 adj EBITDA guidance from $372.5M to $377.5M at the midpoint. Truist lowered their price target from $88 to $80 (70% upside) but maintained their buy rating. They still believe the company’s intrinsic value remains very attractive.

Illumina, Inc. (ILMN) fell through the 50-day moving average. Citi met with Ankur Dhingra, Illumina’s CFO, and reported the difference between cash generation and net income should continue to narrow. The company is reducing their investments and targeting lower M&A than they have historically. Piper Sandler lowered their price target from $195 to $185 (37% upside) and maintained their overweight rating.

Meta Platforms, Inc. (META) announced their plan to introduce advertising to Threads during 2025. JMP believes this could add $1B to the top line by 2026 and sees a path for $10B over the long-term.

Peloton Interactive, Inc. (PTON) and QXO, Inc. (QXO) fell on limited news.

Exhibit 3: Significant² Detractors from Opportunity Equity Representative Account Performance, 11/8/24 - 11/15/24

Name	Type	Net Return
IAC Inc.	Equity	-12.2%
Illumina, Inc.	Equity	-10.6%
Peloton Interactive, Inc.	Equity	-12.9%
Meta Platforms, Inc.	Equity	-6.0%
QXO, Inc.	Equity	-4.1%

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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. 

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