Last week, the Opportunity Equity strategy gained 9.36%, outperforming the S&P 500’s 6.19% gain. (Exhibit 1). The strategy ended the week down -8.92% YTD, 287 basis points behind the S&P 500.
Exhibit 1: Preliminary Performance of Opportunity Equity Strategy Versus S&P 500, Through 3/18/221
| Time Period | Opportunity Equity | S&P 500 |
| Last Week (3/11 - 3/18) | 9.36% | 6.19% |
| MTD | -0.42% | -2.13% |
| QTD | -8.92% | -6.05% |
| YTD | -8.92% | -6.05% |
| Inception (annualized since 6/26/00) | 7.70% | 7.34% |
Source: Bloomberg, Miller Value Partners
JD 1/24 C75 (JD) and Alibaba Group Holding Ltd. (BABA) rose sharply after it was reported that Vice Premier Liu He said at a meeting of the Financial Stability and Development Committee under the State Council that Beijing will “actively release policies favorable to markets” and make sure that any regulation that could have “a significant impact on capital markets” is coordinated with financial management departments in advance as well as highlighting their support for overseas listings. JP Morgan lowered its price on the two names to $35 (46% downside) and $65 (40% downside), respectively. Delta Air Lines Inc (DAL) rose after the company updated 1Q guidance pointing to revenues reaching 78% of 2019 levels up from previous guidance of 72-76% on a strong March with fuel price expected to be $2.80, up 15% from the midpoint of the previous guidance of $2.35-2.50. The company maintained full year guidance of 90% capacity restoration from 2019 levels and CASM-ex fuel (costs per available seat mile) up 7-10% vs 2019 levels. Amazon (AMZN) rose above the 50-day moving average. The company announced it had closed on its $8.5B acquisition of MGM Studios during the week. Morgan Stanley upgraded Norwegian Cruise Lines Ltd. (NCLH) to Equal-Weight with a $19 Price Target (4% downside) while Truist lowered its price target to $20 (0% upside) on slowing booking trends.
Exhibit 2: Significant Contributors to Performance, 3/11/22 - 3/18/22
| Name | Type | Return |
| JD 1/24 C75 | Derivative | 110.9% |
| Alibaba Group Holding Ltd. ADS | Equity | 25.1% |
| Delta Air Lines Inc | Equity | 17.5% |
| Amazon.com Inc | Equity | 10.8% |
| Norwegian Cruise Lines Ltd. | Equity | 13.8% |
Source: Miller Value Partners
Energy Transfer LP (ET) fell below the 50-day moving average as energy prices moved slightly lower during the week. There was limited news on Tivity Health Inc. (TVTY), ADT Inc (ADT), and Pangaea.
Exhibit 3: Significant Detractors from Performance, 3/11/22 - 3/18/22
| Name | Type | Return |
| Tivity Health Inc | Equity | -3.5% |
| Energy Transfer LP | Equity | -3.1% |
| ADT Inc | Equity | -0.4% |
| Cash | Equity | 0.0% |
| Pangaea One, L.P. | Equity | 0.0% |
Source: Miller Value Partners
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1 The 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 information about Opportunity Equity Strategy performance, please click on the Opportunity Equity Strategy 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. Portfolio composition is shown as of a point in time and is subject to change without notice.
©2022 Miller Value Partners, LLC
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