Last week, the Opportunity Equity strategy strategy lost -1.51%, underperforming the S&P 500’s -0.24% loss (Exhibit 1). The strategy ended the week up 5.81% YTD, or even with the S&P 500.
Exhibit 1: Preliminary Performance of Opportunity Equity Versus Equity Indices, Through 4/7/171
| Time Period | Opportunity Equity | S&P 500 |
| Last Week (3/31 - 4/7) | -1.51% | -0.24% |
| MTD | -1.51% | -0.24% |
| QTD | -1.51% | -0.24% |
| YTD | 5.81% | 5.81% |
| Inception (annualized since 12/30/99) | 6.29% | 4.80% |
Source: Bloomberg, Miller Value Partners
Endo Pharmaceuticals Holdings Inc. (ENDP) crossed above the 50-day moving average at the end of the week. The company announced that it is seeking to refinance its existing credit facilities with new senior secured credit in the second quarter. Goldman Sachs issued a positive report on Platform Specialty Products Corp. (PAH) citing PAH’s re-pricing $1.9B of its term loans (which saves $16M in annual after-tax expense) as a positive step forward in its deleveraging strategy. Goldman has a buy rating on the stock with a price target of $16, upside of 20%. RH (RH) formed a bullish golden-cross pattern during the week when its 50-day moving average closed above the 200-day line. Amazon.com Inc. (AMZN) purchased the rights to stream Thursday night football games, paying $50M and beating out Facebook, Twitter and YouTube.
Exhibit 2: Significant Contributors to Performance, 3/31/17 - 4/7/17
| Name | Type | Return |
| Endo Pharmaceuticals | Equity | 5.9% |
| *Recently Added Security* | Equity | 5.3% |
| Platform Specialty Products Corp. | Equity | 2.2% |
| RH | Equity | 1.6% |
| Amazon.com Inc. | Equity | 0.9% |
Source: Miller Value Partners
Valeant Pharmaceuticals International Inc. (VRX) fell below the $10 mark as investors called into question the company’s ability to do $8B worth of asset sales. The Australian Business Review reported that Valeant’s iNova received lukewarm interest with bids coming in below the $1B threshold investors expected. Endurance International Group Holdings (EIGI) announced the resignation of Kenneth Surdan, Chief Product Officer, last week. Kenneth is expected to stay on through July. There was minimal news on the other top detractors.
Exhibit 3: Significant Detractors from Performance, 3/31/17 - 4/7/17
| Name | Type | Return |
| Valeant Pharmaceuticals International | Equity | -13.1% |
| Endurance International Group Holdings | Equity | -10.8% |
| JPMorgan Chase & Co - Warrants | Derivatives | -3.1% |
| Quotient Technology | Equity | -3.7% |
| *Recently Added Security* | Equity | -4.6% |
Source: Miller Value Partners
1The 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 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.
©2017 Miller Value Partners
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