Last week, Opportunity Equity strategy gained 1.24%, outperforming the S&P 500’s -0.58% loss (Exhibit 1). The strategy ended the week up 20.63% YTD, or 1,129 basis points ahead of the S&P 500.
Exhibit 1: Preliminary Performance of Opportunity Equity Strategy Versus S&P 500, Through 6/30/171
| Time Period | Opportunity Equity | S&P 500 |
| Last Week (6/23 - 6/30) | 1.24% | -0.58% |
| MTD | 7.23% | 0.62% |
| QTD | 12.28% | 3.09% |
| YTD | 20.63% | 9.34% |
| Inception (annualized since 12/30/99) | 7.01% | 4.93% |
Source: Bloomberg, Miller Value Partners
Valeant Pharmaceuticals (VRX) was up after hedge fund manager John Paulson reported an increase stake of 6.3% in the company, up from 5.7%. Management also announced they have completed the sale of Dendreon to Sanpower Group for $819.9M and reiterated their expectation to pay off $5Bn in debt by February 2018. Cantor Fitzgerald raised their PT for the stock from $18 to $23, 35% above where it currently trades. JP Morgan (JPM) advanced after announcing plans to repurchase $19.4Bn worth of stock, nearly double the amount their board approved last year. The company also plans to raise its dividend by 12% to $0.56/share. Credit Suisse increased their PT on the stock to $102 from $99, or 10% implied upside. Bank of America (BAC) rose above its 50 and 100-day moving averages after announcing plans to buy back up to $12Bn in shares and boost their quarterly dividend to $0.12/share, up from $0.075. In addition, Berkshire Hathaway reported it will be purchasing 700M shares of BAC stock in a transaction that will make them the firm’s largest shareholder. Pandora (P) gained after the company announced a management shake-up where CEO Tim Westgreen plans to step down. President Mike Herring and CMO Nick Bartle are also departing the company. CFO Naveen Chopra will serve as interim CEO and Jason Hirschhorn has been appointed to the board. The stock was upgraded to sector weight from underweight at Pacific Crest and added to the Alpha Generator list at FBR. There was no news on RH (RH).
Exhibit 2: Significant Contributors to Performance, 6/23/17 - 6/30/17
| Name | Type | Return |
| RH | Equity | 8.5% |
| Valeant Pharmaceuticals International | Equity | 9.5% |
| JPMorgan Chase & Co. - Warrants | Derivative | 10.5% |
| Bank of America Corp. | Equity | 6.3% |
| Pandora Media | Equity | 7.7% |
Source: Miller Value Partners
Shares of Intrexon Corp. (XON) fell below their 200-day moving average while share of Endo Pharmaceuticals (ENDP) fell below their 100-day moving average. Amazon.com (AMZN) moved below its 50-day moving average as technology shares continued their slide. Further, Nike (NKE) disclosed it is in the early stages of a new pilot program where they plan to sell shoes and apparel directly on the AMZN platform. Apple (APPL) acquired SensoMotoric Instruments, a German maker of eye-tracking technology for virtual reality. Seagate Technology (STX) fell in sympathy with peer Western Digital (WDC), whose 4Q preannouncement failed to impress the street and may have implied some softness in the HDD market. Shares of STX fell below their 200-day moving average.
Exhibit 3: Significant Detractors from Performance, 6/23/17 - 6/30/17
| Name | Type | Return |
| Intrexon Corp. | Equity | -5.0% |
| Endo Pharmaceuticals Holdings | Equity | -5.7% |
| Amazon.com Inc. | Equity | -3.6% |
| Apple Inc. C100 1/18 | Derivative | -5.1% |
| Seagate Technology | Equity | -9.2% |
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
Share