Last week, the Opportunity Equity strategy gained 0.61%, outperforming the S&P 500’s 0.30% rise (Exhibit 1). The strategy ended the week up 27.96% YTD, or 573 basis points ahead of the S&P 500.
Exhibit 1: Preliminary Performance of Opportunity Equity Strategy Versus S&P 500, Through 12/22/171
| Time Period | Opportunity Equity | S&P 500 |
| Last Week (12/15 - 12/22) | 0.61% | 0.30% |
| MTD | 2.94% | 1.44% |
| QTD | 6.92% | 6.99% |
| YTD | 27.96% | 22.23% |
| Inception (annualized since 12/30/99) | 7.26% | 5.45% |
Source: Bloomberg, Miller Value Partners
Valeant Pharmaceuticals (VRX) through their wholly-owned subsidiary, Bausch and Lomb, announced that is has begun distributing VYZULTA, the first prostaglandin analog which is indicated for the reduction of intraocular pressure in patients with open-angle glaucoma or ocular hypertension. VYZULTA will be available to patients across the United States within the next few days. The company also announced it has finalized the sale of Sprout Pharmaceuticals back to the original shareholders in exchange for a 6% royalty on global sales. Buckingham Research Group upgraded United Continental Holdings (UAL) to “Buy” from “Neutral” with an $81 price target, 20.1% above where it currently trades. The analyst attributes the upgrade to the active steps the company is taking to address revenue weakness, a favorable macro backdrop, and longer term cash implications of tax reform. American Air Lines (AAL) rose in sympathy with peer, United. Homebuilder Lennar Corp (LEN) announced they have broken ground on a new 160-unit, 14.3 acre community in southern Florida. Platform Specialty Products (PAH) rose on news that Chairman, Martin Franklin, as well as Berggruen Holdings each purchased 500,000 shares. Nicholas Berggruen, a director of Platform, is also a director of Berggruen Holdings.
Exhibit 2: Significant Contributors to Performance, 12/15/17 – 12/22/17
| Name | Type | Return |
| Valeant Pharmaceuticals Intl Inc | Equity | 9.2% |
| United Continental Holdings | Equity | 5.5% |
| Lennar Corp | Equity | 4.2% |
| Platform Specialty Products | Equity | 5.1% |
| American Air Lines Inc | Equity | 2.1% |
Source: Miller Value Partners
RH (RH) closed the week below its 50-day moving average. Pandora (P) announced it has expanded its partnership with Comcast (CMCSA) to integrate its on-demand premium services onto the Xfinity platform by allowing subscribers to play music through their television. Genworth (GNW) fell as Fitch downgraded the Insurer Financial Strength (IFS) ratings of Genworth Life Insurance Company and Genworth Life Insurance Company of New York to B+ from BB. The downgrade follows a second extension of the closing deadline of the proposed acquisition of Genworth by China Oceanwide Holdings Group, which is currently subject to regulatory approval. There was no news on Intrexon (XON) or Ziopharm Oncology (ZIOP).
Exhibit 3: Significant Detractors from Performance, 12/15/17 - 12/22/17
| Name | Type | Return |
| RH | Equity | -6.6% |
| Intrexon Corp | Equity | -7.4% |
| Pandora Media Inc | Equity | -9.6% |
| Genworth Financial Inc | Equity | -3.3% |
| Ziopharm Oncology Inc | Equity | -6.9% |
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.
©2017 Miller Value Partners, LLC
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