Last week, the Opportunity Equity strategy gained 1.25%, outperforming the S&P 500’s -0.51% decline (Exhibit 1). The strategy ended the week up 10.48% YTD, 160 basis points ahead of the S&P 500.
Exhibit 1: Preliminary Performance of Opportunity Equity Strategy Versus S&P 500, Through 10/23/201
| Time Period | Opportunity Equity | S&P 500 |
| Last Week (10/16 - 10/23) | 1.25% | -0.51% |
| MTD | 8.05% | 3.14% |
| QTD | 8.05% | 3.14% |
| YTD | 10.48% | 8.88% |
| Inception (annualized since 6/26/00) | 7.69% | 6.42% |
Source: Bloomberg, Miller Value Partners
Farfetch Ltd (FTCH) gained in sympathy with luxury brands that announced earnings ahead of expectations including LVMH, Kering, Hermes and Moncler. Uber Technologies Inc. (UBER) crossed back above the 50-day moving average as Oppenheimer increased their price target from $37 to $40 (upside of 8.9%). Uber Eats recorded strong download data in the US and UK, recording a 21% increase in users on the app. On the flip side, the company was ordered to comply with the AB-5 California labor law, putting more pressure on the November ballot proposition in which Californians will vote on whether to grant Uber and Lyft the ability to continue treating their drivers as contractors. Stitch Fix Inc. (SFIX) saw a new rating at Lane Research with a price target of $45, upside of 26.9%. Facebook Inc. (FB) crossed above the 50-day moving average as the company received a number of price target increases including Credit Suisse adjusting their price target to $322 from $315 (upside of 13.1%), and Jefferies increasing their price target to $320 from $310 (upside of 12.4%). OneMain Holdings Inc. (OMF) gained as September Trust data showed personal loans had an average net loss rate of 3.79%, up 72bps MoM, and Direct Auto Loans had $2.1M in monthly losses and an annualized loss rate of 1.39%, -23bps MoM.
Exhibit 2: Significant Contributors to Performance, 10/16/20 - 10/23/20
| Name | Type | Return |
| Farfetch Ltd. | Equity | 11.0% |
| Uber C32 Jan 2022 | Derivative | 22.3% |
| Stitch Fix, Inc. | Equity | 8.8% |
| Facebook Inc. | Equity | 7.1% |
| OneMain Holdings Inc. | Equity | 5.7% |
Source: Miller Value Partners
Taylor Morrison Home Corp. (TMHC) and Lennar Corp. (LEN) crossed below the 50-day moving average. The stocks fell on the news of monthly housing starts coming in at 1.9%, below expectations for 3.5% in September. Most of the decline was in multi-family housing, which was down 16.7%, while single-family starts came in up 8.5%. B. Riley raised their price target on Taylor Morrison to $35 from $29 (upside of 38.6%). ADT Inc. (ADT) dropped below the 200-day moving average as Morgan Stanley dropped their price target to $10 from $17 (upside of 33.9%) noting that the financial benefits from the Google Partnership could take longer to materialize. The company named Derrick Dioci, who joins them from Comcast, as Chief Strategy Officer. Ziopharm Oncology (ZIOP) dropped sharply as they received a notice that a group of shareholders is attempting to remove four board members and bring on three of their own. The company urged rejection of the plan by other shareholders. Flexion Therapeutics (FLXN) fell below the 100-day and 200-day moving averages.
Exhibit 3: Significant Detractors from Performance, 10/16/20 - 10/23/20
| Name | Type | Return |
| Taylor Morrison Home Corp. | Equity | -6.8% |
| ADT Inc. | Equity | -5.9% |
| Ziopharm Oncology Inc. | Equity | -16.2% |
| Flexion Therapeutics | Equity | -9.2% |
| Lennar Corp. | Equity | -7.5% |
Source: Miller Value Partners
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.
©2019 Miller Value Partners, LLC
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