Last week, the Opportunity Equity strategy gained 4.67%, outperforming the S&P 500’s 3.59% rise (Exhibit 1). The strategy ended the week up 4.75% YTD, or 12 basis points ahead of the S&P 500.
Exhibit 1: Preliminary Performance of Opportunity Equity Strategy Versus S&P 500, Through 3/9/181
| Time Period | Opportunity Equity | S&P 500 |
| Last Week (3/2 -3/9) | 4.67% | 3.59% |
| MTD | 5.03% | 2.75% |
| QTD | 4.75% | 4.63% |
| YTD | 4.75% | 4.63% |
| Inception (annualized since 12/30/99) | 7.37% | 5.63% |
Source: Bloomberg, Miller Value Partners
Amazon.com Inc (AMZN) is reportedly in talks with banks, including JPMorgan Chase (JPM), about building a checking account-like product that the company would offer to its customers, particularly the younger demographic and those without bank accounts. Further, UBS raised their price-target for Amazon to $1,760 (from $1,620), or 9.8% upside, while Evercore ISI raised their price-target to $1,745 (from $1,580), or 8.9% upside. Genworth Financial (GNW) closed the week above its 50-day moving average as the company announced it closed a five year $450M senior secured term loan, from which the proceeds will be used to repay existing debt. OneMain Holdings (OMF) announced the pricing of $1.25B (upsized from $500M) of 6.875% senior notes due March 2025 through its wholly owned subsidiary Springleaf Finance Corporation. The stock moved above its 50-day moving average. There was no news on Quotient Technology (QUOT).
Exhibit 2: Significant Contributors to Performance, 3/2/18 - 3/9/18
| Name | Type | Return |
| Amazon.com Inc | Equity | 5.2% |
| JPMorgan Chase & Co. – Warrant | Derivative | 6.5% |
| Quotient Technology Inc. | Equity | 7.3% |
| Genworth Financial Inc. | Equity | 10.6% |
| OneMain Holdings Inc. | Equity | 4.8% |
Source: Miller Value Partners
RH (RH) fell throughout the week and formed a death cross, despite the bullish note from Citi which states the recent-sell off in shares presents an attractive entry point ahead of Q4 earnings. Citi maintains a “Buy” rating with a $135 price target, 77.3% implied upside. Discovery Communications (DISCA) announced it has completed the acquisition of Scripps Networks Interactive (SNI), and moving forward the combined company will officially be Discovery, Inc. The acquisition is expected to be accretive to adjusted EPS and FCF in its first year, including material cost synergies and deleveraging opportunities. There was no news on other top detractors (GTYHU, GME).
Exhibit 3: Significant Detractors from Performance, 3/2/18 - 3/9/18
| Name | Type | Return |
| RH | Equity | -3.0% |
| Discovery Communications Inc. | Equity | -2.0% |
| GTY Technology Holdings Inc. | Equity | -0.5% |
| GameStop Corp. Class A | Equity | -1.8% |
| Cash | Cash | 0.0% |
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.
©2018 Miller Value Partners, LLC
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