Last week, the Opportunity Equity Strategy's representative account was flat, underperforming the S&P 500’s 1.41% rise. (Exhibit 1). The strategy ended the week up 3.29% YTD, 57 basis points behind the S&P 500.
Exhibit 1: Performance of Opportunity Equity Representative Account Net of Fees, Versus S&P 500, Through 3/24/231
| Time Period | Opportunity Equity Representative Account | S&P 500 |
| Last Week (3/17 - 3/24) | 0.00% | 1.41% |
| MTD | -10.47% | 0.16% |
| QTD | 3.29% | 3.86% |
| YTD | 3.29% | 3.86% |
| 1 Year | -28.32% | -10.63% |
| 5 Year | 2.54% | 10.87% |
| 10 Year | 7.92% | 11.95% |
| Inception (annualized since 6/26/00) | 5.85% | 6.53% |
Source: Bloomberg, Miller Value Partners. Visit the Strategy page for Opportunity Equity performance through the most current month end period.
PureTech Health PLC (PRTC LN) rose after announcing the sale of their 3% royalty in Karuna’s KarXT to Royalty Pharma for $100m upfront cash and $400M in additional milestone payments. The agreement covers revenue up to $2B, after which Royalty Pharma will receive 33% of the royalty while PureTech will receive 67%.
Meta Platforms, Inc. (META) continued to rise on rumors of a potential ban of rival social media app TikTok, with TikTok CEO testifying before congress over the course of the week. Morgan Stanley raised its price target to $250 (21% upside) from $190, while upgrading the name to overweight from equal-weight. JP Morgan raised its price target to $275 from $225 (33% upside).
JPMorgan initiated on Alibaba Group Holdings Limited (BABA) with an overweight rating and a price target of $140, upside of 61%. The report focused on the rebound in Chinese consumption in 2023 as well as the potential for a valuation re-rating.
Alphabet Inc. (GOOGL) rose above the 200-day moving average. During the week, the company opened a beta version of its new Bard AI chatbot to testers. Stifel resumed coverage with a $130 price target (23% upside).
Taylor Morrison Home Corp. (TMHC) gained over the week as February new home sales rose 1.1% sequentially, above expectations for a 3.1% decline. Absolute inventory fell 0.7% sequentially to 436k, down 24% from peak levels. Median prices rose 2.7% sequentially to $438k. February existing home sales rose 14.5% sequentially to 4.58M above expectations for a 5% rise to 4.20M.
Exhibit 2: Significant2 Contributors to Opportunity Equity Representative Account Performance, 3/17/23 - 3/24/23
| Name | Type | Net Return |
| Meta Platforms Inc. | Equity | 5.3% |
| Alibaba Group Holding Limited | Equity | 6.4% |
| Puretech Health PLC | Equity | 9.8% |
| Alphabet Inc. | Equity | 3.8% |
| Taylor Morrison Home Corp. | Equity | 3.4% |
Source: Miller Value Partners. See below for additional information.
Coinbase Global, Inc. (COIN) fell after the company received a Wells Notice from the SEC, implying that the SEC staff, on conclusion of an investigation of the company, have recommended that the commission file an enforcement action for potential violations of securities law, likely targeting alt-coins and staking. Barclays raised its price target to $86 from $83 (22% upside). TD Cowen downgraded the name in the wake of the announcement from market perform to underperform, maintaining its $36 price target (47% downside).
Travel names continued to get hit over the week on increasing fears of a recession with Expedia Group Inc. (EXPE) and Travel + Leisure Co. (TNL) trading down on limited company specific news.
United Airlines Holdings, Inc. (UAL) fell through the 200-day moving average. United announced the first air taxi route in Chicago, partnering with Archer in a route from O’Hare Airport to Vertiport Chicago. Delta Air Lines, Inc. (DAL) fell despite S&P revising its credit outlook to positive from neutral, while affirming its BB rating.
Exhibit 3: Significant2 Detractors from Opportunity Equity Representative Account Performance, 3/17/23 - 3/24/23
| Name | Type | Net Return |
| Coinbase Global, Inc. | Equity | -9.2% |
| Delta Air Lines Inc. | Equity | -4.2% |
| Expedia Group Inc. | Equity | -3.1% |
| Travel + Leisure Co. | Equity | -4.5% |
| United Airline Holdings Inc. | Equity | -3.9% |
Source: Miller Value Partners. See below for additional information.
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As of prior week's market close unless otherwise stated.
1The performance figures for the representative Opportunity Equity account reflect the deduction investment management fees and certain other expenses. Returns greater than 1 year are annualized.
For additional information about Opportunity Equity Strategy performance, please click on the Opportunity Equity Strategy Composite Performance Disclosure. Past performance is no guarantee of future results.
2Significant Contributors and Detractors are based on holdings that had the greatest effect on representative account performance for the week. Holdings that have been in the portfolio since the end of the most recent calendar quarter are identified by name. The net return shown above for each individual security represents the change in market price of the security during the week, according to a third-party pricing service, or for the partial period held in the portfolio during the week. Net returns also include any purchases or sales that were made during the week. 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. There is no guarantee that market trends discussed herein will continue. 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. References to specific securities are for illustrative purposes only. Portfolio composition is shown as of a point in time and is subject to change without notice. Content may not be reprinted, republished or used in any manner without written consent from Miller Value Partners.
©2023 Miller Value Partners, LLC
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