Last week, the Opportunity Equity strategy gained 4.05%, outperforming the S&P 500’s 2.03% return. (Exhibit 1). The strategy ended the week up 10.93% YTD, 1,563 basis points behind the S&P 500.
Exhibit 1: Preliminary Performance of Opportunity Equity Strategy Versus S&P 500, Through 11/5/211
| Time Period | Opportunity Equity | S&P 500 |
| Last Week (10/29 - 11/5) | 4.05% | 2.03% |
| MTD | 4.05% | 2.03% |
| QTD | 6.22% | 9.17% |
| YTD | 10.93% | 26.56% |
| Inception (annualized since 6/26/00) | 8.99% | 7.70% |
Source: Bloomberg, Miller Value Partners
Canada Goose Holdings Inc. (GOOS) crossed its 50, 100, and 200-day moving averages after strong quarterly earnings. The company reported revenue of $233M vs $206M expected with EPS of $0.12 beating consensus of -$0.10. The company raised 2021 guidance bringing revenues to $1.125-$1.175 Bn from previously in excess of $1 Bn and EPS to $1.17-$1.33. The company highlighted that they are well positioned to meet demand due to their vertically integrated supply chain. Norwegian Cruise Lines (NCLH) crossed above its 50, 100, and 200-day moving average. The company reported disappointing 3Q21 results with revenue coming in at $153M below consensus at $247M with EPS of -$2.17 below expectations for -$2.04. The company reported that 40% of its capacity was operating by the end of 3Q and they expect 75% to be operating by the end of 2021 with the full fleet back up and running by April 1, 2022. They also highlighted that they expect to be operating cash flow positive in late 1Q22 and profitable for 2H22. The company benefited from strong clinical trial results from Pfizer’s new Covid-19 oral antiviral candidate. Tivity Health Inc (TVTY) crossed above its 50, 100, 200-day moving averages on solid Q3 earnings – exceeding expectations now for seven consecutive quarters. Revenue came in at $126.3M, ahead of consensus $122M, and Adjusted EBITDA came in at $40.5M ahead of consensus of $35.7M. The company increased full year guidance bringing up revenue guidance to $475-485M (from $465-485M), adjusted EBITDA to $156-159M (from $151-155M), and adjusted EPS to $1.61-1.67 (from $1.54-1.62). The company now expects to generate $70-79M in FCF up from $60-70M previously. Delta Air Lines Inc (DAL) rose above its 50, 100, and 200-day moving averages also benefitting from the Pfizer news. ADT Inc (ADT) rose on limited news.
Exhibit 2: Significant Contributors to Performance, 10/29/21 - 11/5/21
| Name | Type | Return |
| Canada Goose Holdings Inc. | Equity | 30.07% |
| Norwegian Cruise Line Holdings Ltd. | Equity | 12.38% |
| Tivity Health Inc | Equity | 12.03% |
| Delta Air Lines Inc | Equity | 13.19% |
| ADT Inc | Equity | 8.26% |
Source: Miller Value Partners
Tupperware (TUP) fell after reporting 3Q results. The company reported revenue of $376.9M, well-below consensus of $482M with EBITDA of $68.9M lagging consensus of $82.1M leading to EPS of -$1.63 vs $0.75 expected. Management blamed poor top-line performance on the rollout of its news sales software in the US, emphasizing that this would be a short-term issue. Herbalife Nutrition (HLF) declined following their 3Q earnings which came in ahead of recently reduced guidance. The company reported revenues of $1.43B slightly below consensus of $1.45B, with EBITDA beating coming in at $225M vs $207M expected and EPS of $1.21 ahead of consensus of $1.06. Management reiterated full year guidance. TLT P140 1/20/23 (TLT) declined over the week as long-date rates fell. Alibaba (BABA) fell below its 50-day moving average as Morningstar lowered their fair value on the company to $284, upside of 80%, on weak macro and social initiatives. Farfetch Ltd (FTCH) fell on limited news.
Exhibit 3: Significant Detractors from Performance, 10/29/21 - 11/5/21
| Name | Type | Return |
| Tupperware Brands Corp | Equity | -18.26% |
| Herbalife Nutrition Ltd | Equity | -6.92% |
| Farfetch Ltd | Equity | -4.75% |
| Alibaba Group Holding Ltd. ADS | Equity | -3.77% |
| TLT 1/23 P140 | Derivative | -6.73% |
-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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