Last week, the Opportunity Equity strategy gained 1.35%, underperforming the S&P 500’s 2.76% gain (Exhibit 1). The strategy ended the week up 20.05% YTD, 966 basis points ahead of the S&P 500.
Exhibit 1: Preliminary Performance of Opportunity Equity Strategy Versus S&P 500, Through 4/9/211
| Time Period | Opportunity Equity | S&P 500 |
| Last Week (4/2 - 4/9) | 1.35% | 2.76% |
| MTD | 2.90% | 3.97% |
| QTD | 2.90% | 3.97% |
| YTD | 20.05% | 10.39% |
| Inception (annualized since 6/26/00) | 9.67% | 7.21% |
Source: Bloomberg, Miller Value Partners
ADT Inc (ADT) pushed through the 50-day and 100-day moving average. The company named Sigal Zarmi, Chief Information Officer at Morgan Stanley, to the Broad of Directors. Norwegian Cruise Line Holdings Ltd. (NCLH) rose as the company submitted a US restart plan to the CDC with plans to start cruising from US Ports on July 4th, with Caribbean voyages beginning again on July 25th. The company is awaiting approval from the CDC, which noted that they might allow cruises by mid-summer, with mandatory vaccination for passengers. Amazon.com Inc. (AMZN) rose through the 50-day and 100-day moving average. Amazon workers at an Alabama warehouse voted not to join a retail union. According to the WSJ, Amazon now represents 10.3% of the digital ad market in 2020 up from 7.8% in 2019. Evercore ISI raised their price target on the name to $4,000, upside of 19%. Alphabet Inc. (GOOGL) got an important victory at the US Supreme Court, which ruled in a 6-2 decision that the company did not violate Oracle’s copyrights when it copied 11,330 lines of code to build its Android operating system. Oracle had been seeking $8bn in damages but some estimates were far higher than that. Argus raised their price target on the company to $2,500 from $2,400 (upside of 10%) on a stronger digital ad market outlook. Evercore ISI Group initiated coverage with a buy rating and a price target of $2,525 (upside of 10.4%).
Exhibit 2: Significant Contributors to Performance, 4/2/21 - 4/9/21
| Name | Type | Return |
| ADT Inc | Equity | 12.3% |
| *New Security* | Derivative | 30.9% |
| Norwegian Cruise Line Holdings Ltd. | Equity | 10.2% |
| Amazon.com Inc | Equity | 6.7% |
| Alphabet Inc | Equity | 6.6% |
Source: Miller Value Partners
Evercore ISI resumed coverage of Diamondback Energy Inc. (FANG) with a buy rating and a price target of $95, upside of 27%. Truist raised their price target again from $105 to $115 (upside of 53.7%) citing recent deals in the Permian highlighting the attractive acquisition of Guidon and QEP by Diamondback last year. WW International (WW) fell through the 50-day moving average as Morgan Stanley cut the stock from ‘overweight to ‘equal weight’ and maintained the price target of $34 (upside of 14.2%) on 1Q app download data weakness. Teva Pharmaceutical-SP (TEVA) fell through the 50-day moving average despite the company getting marketing authorization for Seffalair Spiromaz and BroPair Spiromax in the EU which are targeted for Asthma patients. Farfetch Ltd. (FTCH) dropped as there continued to be block trade selling from a major hedge fund liquidation. JP Morgan put out a note saying the pullback creates a “compelling buying opportunity” and reiterated their $72 price target (upside of 40.7%). Desktop Metal (DM) fell through the 200-day moving average on limited news.
Exhibit 3: Significant Detractors from Performance, 4/2/21 - 4/9/21
| Name | Type | Return |
| Diamondback Energy Inc | Equity | -7.9% |
| Desktop Metal Inc. | Equity | -8.1% |
| WW International Inc | Equity | -6.4% |
| Teva Pharmaceutical | Equity | -3.8% |
| Farfetch Ltd | Equity | -3.3% |
-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.
©2020 Miller Value Partners, LLC
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