Last week, the Opportunity Equity strategy lost -0.83%, outperforming the S&P 500’s -1.42% decline (Exhibit 1). The strategy ended the week up 7.51% YTD, or 757 basis points behind the S&P 500.
Exhibit 1: Preliminary Performance of Opportunity Equity Strategy Versus S&P 500, Through 8/23/191
| Time Period | Opportunity Equity | S&P 500 |
| Last Week (8/16 - 8/23) | -0.83% | -1.42% |
| MTD | -9.03% | -4.30% |
| QTD | -6.60% | -2.92% |
| YTD | 7.51% | 15.08% |
| Inception (annualized since 6/26/00) | 6.37% | 5.62% |
Source: Bloomberg, Miller Value Partners
Endo International (ENDP) gained over the week after announcing a settlement in principle with the two Ohio counties to resolve Track 1 cases with Endo paying $10M and providing up to $1M of Vasostrict and Adrenalin products free of charge. Teva Pharmaceuticals Inc. (TEVA) gained in sympathy with ENDP as analysts extrapolated ENDP’s settlement to reach an implied total settlement value lower than analysts has been estimating. Lennar Corp. (LEN) crossed above the 100-day moving average. July total existing home sales rose 2.5% sequentially to 5.42M, in-line with expectations, while single-family existing homes sales rose 2.8% sequentially to 4.84M. On a year over year basis, both total and single-family existing home sales turned positive reversing a 16-month trend of YoY declines. July new home sales fell 12.8% sequentially to 635K, below expectations of a 0.2% rise but up 4.3% YoY. Lennar was rated a new buy at Seaport Global Securities with a price target of $71, 37% upside. Ziopharm Oncology Inc. (ZIOP) was resumed at Raymond James with an Outperform rating and a price target of $6.50, 41% upside. There was minimal news on RH (RH).
Exhibit 2: Significant Contributors to Performance, 8/16/19 - 8/23/19
| Name | Type | Return |
| Endo International plc | Equity | 28.3% |
| Teva Pharmaceuticals | Equity | 10.0% |
| Lennar Corp | Equity | 4.0% |
| Ziopharm Oncology Inc | Equity | 3.4% |
| RH | Equity | 2.1% |
Source: Miller Value Partners
Intrexon Corp. (XON) crossed below the 100 and 200-day moving average. Intrexon’s subsidiary ActoBio Therapeutics received permission from the FDA for its IND application for AG017, an innovative orally-delivered therapeutic candidate for the treatment of celiac disease. NXP Semiconductors (NXPI) crossed below the 50-day moving average. Raymond James initiated coverage on the name with an outperform rating and a price target of $115, upside of 31%. Alibaba Group Holdings (BABA) crossed below the 50 and 200-day moving average. The company announced that it was postponing the company’s listing on the Hong Kong Stock Exchange. Delta Air Lines Inc. (DAL) crossed below the 100-day moving average. There was minimal news on Facebook Inc. (FB).
Exhibit 3: Significant Detractors from Performance, 8/16/19 - 8/23/19
| Name | Type | Return |
| Intrexon Corp. | Equity | -17.7% |
| NXP Semiconductors | Equity | -5.4% |
| Facebook Inc. | Equity | -3.2% |
| Alibaba Group Holdings | Equity | -5.8% |
| Delta Air Lines Inc. | Equity | -3.2% |
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. Content may not be reprinted, republished or used in any manner without written consent from Miller Value Partners.
©2019 Miller Value Partners, LLC
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