Last week, the Opportunity Equity strategy gained 1.26%, underperforming the S&P 500’s 1.84% return. (Exhibit 1). The strategy ended the week up 8.71% YTD, 1,169 basis points behind the S&P 500.
Exhibit 1: Preliminary Performance of Opportunity Equity Strategy Versus S&P 500, Through 10/15/211
| Time Period | Opportunity Equity | S&P 500 |
| Last Week (10/8 - 10/15) | 1.26% | 1.84% |
| MTD | 4.09% | 3.86% |
| QTD | 4.09% | 3.86% |
| YTD | 8.71% | 20.40% |
| Inception (annualized since 6/26/00) | 8.91% | 7.47% |
Source: Bloomberg, Miller Value Partners
Splunk Inc. (SPLK) gained after UBS posted a positive note on the company after speaking with 11 current Splunk customers. Most of the customers noted that they were already deploying Splunk in the cloud or were seriously evaluating the option. SoFi Technologies, Inc. crossed above the 100 and 200-day moving average after Morgan Stanley initiated on the name with an overweight rating and a $25 price target, upside of 29%. Amazon (AMZN) crossed above the 50, 100 and 200-day moving average. Mark Mahaney at Evercore ISI hosted an “Amazon Day” last week, which included five panels across five key topics – Regulation, Logistics, Retail, Digital Advertising, and Cloud, where they spoke with 15 different industry experts. Mark maintains an outperform rating on the name with a price target of $4,700, upside of 38%. Alibaba Group Holdings Ltd. (BABA) crossed above the 50-day moving average as news broke that a firm that Charlie Munger chairs nearly doubled their investment in Alibaba over 3Q.
Exhibit 2: Significant Contributors to Performance, 10/8/21 - 10/15/21
| Name | Type | Return |
| Splunk Inc. | Equity | 9.34% |
| Sofi Technologies Inc. | Equity | 19.56% |
| Amazon.com Inc. | Equity | 3.66% |
| Amazon.com Inc. C3050 1/2023 | Derivative | 12.84% |
| Alibaba Group Holdings Ltd. | Equity | 4.03% |
Source: Miller Value Partners
Teva Paharmaceuticals (TEVA) fell below its 100-day moving average. Delta Air Lines Inc. (DAL) fell below the 50 and 100-day moving average despite posting strong 3Q results with better than expected profitability. The company reported total revenue ex refinery declined 34% from 2019 levels with total costs declining 17% leading to EPS of $0.30 vs $0.15 expected. The company guided for 4Q revenue to be down high-20% vs 2019 levels in-line with consensus but guidance on cost per available seat mile (CASM) disappointed at up 6-8% vs 2019 levels vs consensus at up 3%. Management highlighted that the rise in fuel prices would pressure their ability to remain profitable in the December quarter. Matterport Inc. (MTTR) was added to Wedbush best ideas list. There was minimal news on Green Thumb Industries Inc. (GTBIF).
Exhibit 3: Significant Detractors from Performance, 10/8/21 - 10/15/21
| Name | Type | Return |
| *New Security* | Derivative | -14.32% |
| Teva Pharmaceuticals ADR | Equity | -4.72% |
| Green Thumb Industries Inc. | Equity | -6.14% |
| Delta Air Lines Inc | Equity | -5.51% |
| Matterport Inc. | Equity | -3.82% |
-Source: Miller Value Partners
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1The performance figures reflect the results of a representative account net of management fee 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. Content may not be reprinted, republished or used in any manner without written consent from Miller Value Partners.
©2021 Miller Value Partners, LLC
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