Last week, the Opportunity Equity strategy lost 1.45%, underperforming the S&P 500’s 0.28% rise (Exhibit 1). The strategy ended the week up 7.33% YTD, or 61 basis points ahead of the S&P 500.
Exhibit 1: Preliminary Performance of Opportunity Equity Versus Equity Indices, Through 3/17/171
| Time Period | Opportunity Equity | S&P 500 |
| Last Week (3/10 - 3/17) | -1.45% | 0.28% |
| MTD | -2.13% | 0.73% |
| QTD | 7.33% | 6.72% |
| YTD | 7.33% | 6.72% |
| Inception (annualized since 12/30/99) | 6.40% | 4.87% |
Source: Bloomberg, Miller Value Partners
Endurance Int. Group Holdings (EIGI) crossed above the 100-day and 50-day moving average. RH (RH) continued to moving higher over the week as KeyBanc Capital Markets issued a report discussing the value to acquirers. Platform Specialty Products Corp. (PAH) announced Thursday that John Connolly would be replacing Sanjeev Khattri as CFO. There was minimal news on Genworth Financial Inc. (GNW).
Exhibit 2: Significant Contributors to Performance, 3/10/17 - 3/17/17
| Name | Type | Return |
| *Recently Added Security* | Equity | 7.6% |
| Endurance International Group Holdings | Equity | 4.4% |
| RH | Equity | 2.7% |
| Platform Specialty Products Corp. | Equity | 1.9% |
| Genworth Financial | Equity | 2.5% |
Source: Miller Value Partners
Intrexon Corp. (XON) fell below the 50-day moving average. Valeant Pharmaceuticals International Inc. (VRX) fell last week after it was released that Pershing Square (previously Valeant’s largest holder) had exited its position in the company. This was followed by ValueAct Capital buying shares in VRX increasing its position to 5.2% and the CFO, Paul Herendeen, buying 24K shares (16% increase in his share count) along with Richard U. de Schutter, Director, buying 10K shares. United Continental Holdings (UAL) fell below the 100-day moving average after increasing domestic capacity guidance from 1.5-2.5% to 3.5-4.5% and being downgraded to in-line by Evercore ISI with a price target of $75, upside of 12%. American Airlines Group Inc. (AAL) moved lower on worries of UAL’s increase in capacity. Pandora Media Inc. (P) launched its premium subscription tier for $9.99/month to customers who had signed up for early access. All customers will have access to the subscription service over the next few weeks.
Exhibit 3: Significant Detractors from Performance, 3/10/17 - 3/17/17
| Name | Type | Return |
| Intrexon Corp. | Equity | -11.7% |
| Valeant Pharmaceuticals Intl. Inc. | Equity | -9.9% |
| United Continental Holdings | Equity | -7.7% |
| American Airlines Group Inc. | Equity | -5.0% |
| Pandora Media Inc. | Equity | -5.4% |
Source: Miller Value Partners
1The performance figures reflect the deduction of a model investment management fee of 1% (the highest fee for separate accounts under our fee schedule) and certain other expenses. For important additional information about Opportunity Equity performance, please click on the Opportunity Equity Composite Performance Disclosure. The performance returns shown in this report are preliminary and are subject to revision. Past performance is no guarantee of future results.
Significant Contributors and Significant Detractors are the Strategy holdings that had the greatest effect on Strategy performance for the week. Holdings that have been in the Strategy since the end of the most recent calendar quarter are identified by name. 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 Miller Value Partners disclaims any responsibility to update such views. 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.
©2017 Miller Value Partners
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