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Quarter	Letter Date	Fund Name	QTD	YTD	Tickers	Themes	Quick Take

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Miller Value Partners Deep Value Strategies 2024 Q1 Investor Letter | Buyside Digest

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Primary Source Intelligence • Q1 2024 Letter Analysis

Miller Value Partners Deep Value Strategies Quarterly Analysis

Buyside Digest is not affiliated with, and does not endorse, Miller Value Partners Deep Value Strategies. This analysis is provided for institutional research purposes only and is not investment advice.

Fund Returns

Annualized+22%

Digest Analysis

Quick Take

"Miller Deep Value targets concentrated small-cap value opportunities amid extreme market concentration. Portfolio holds undervalued companies with double-digit earnings yields including infrastructure beneficiary Tutor Perini and media play Gray Television."

Executive Summary

Miller Deep Value Select Strategy returned 2.0% net in Q1 2024, underperforming broader value indices as small-cap and lower valuation stocks lagged in the first two months before leading in March. Manager Dan Lysik emphasizes the significant opportunity in value investing amid extreme market concentration, with the top five S&P 500 holdings now 3.3x the size of the entire Russell 2000. The strategy maintains concentrated positions in undervalued small-cap companies with double-digit earnings and free cash flow yields. Key holdings include Tutor Perini, benefiting from federal infrastructure spending; Gray Television, positioned for political advertising recovery; Fossil Group, undergoing transformation; and new position Lincoln Financial, trading at significant discount to book value. Small caps represent only 4% of total equity market versus 8% long-term average, creating opportunity for outperformance as earnings growth accelerates in 2024's second half. The manager sees attractive long-term return potential from current market dislocation and valuation spreads.

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Institutional Meta Strategy

Meta Strategy Gauges

Algorithmic conviction, macroeconomic posture, and risk appetite signals extracted from this quarterly letter with qualitative explanations.

Signal Matrix

Market Conviction

78%

CautiousHigh

High Conviction (78%)

High conviction evidenced by concentrated portfolio with detailed analysis of individual holdings including specific price targets and earnings projections. Manager provides explicit position sizing commentary, discusses 3-5 year return potential for Lincoln Financial, and maintains positions through volatility with clear fundamental rationale for each holding.

Growth Outlook

25%

BearishBullish

Bearish (25%)

Manager expresses cautious optimism about value opportunities while acknowledging stretched mega-cap valuations. Sees positive developments with market broadening in March and small-cap earnings improvement expected in back half of 2024, but notes concerns about overall market concentration and elevated valuations.

Risk Appetite

50%

DefensiveAggressive

Balanced (50%)

Portfolio maintains concentrated exposure to small-cap value names with manager adding new position in Lincoln Financial during quarter. Strategy remains fully invested in undervalued securities with high conviction, demonstrating moderate risk appetite despite market concerns.

Capital Deployment

20%

De-riskingDeploying

De-risking (20%)

Manager initiated new position in Lincoln Financial during quarter, indicating selective deployment activity. However, no explicit cash level changes mentioned and deployment appears measured rather than aggressive, suggesting modest net deployment into attractive opportunities.

Forward Guidance

40%

CautiousExpansionary

Neutral (40%)

Manager indicates selective deployment bias toward value opportunities and expects to benefit from market broadening trends. Sees attractive long-term return potential but emphasizes patience and selectivity rather than aggressive near-term deployment.

Language Signal

30%

BearishBullish

Bearish (30%)

Language balances opportunity identification in value stocks with risk warnings about mega-cap valuations and market concentration. More opportunity-focused than risk-focused but acknowledges significant market headwinds and valuation concerns.

Perceived Risk

65%

Low RiskElevated

Elevated Risk (65%)

Manager identifies multiple specific risks including mega-cap valuations at 32.5x forward P/E, market concentration exceeding dot-com bubble levels, and Technology sector trading at 59% premium to 20-year average. Detailed discussion of systemic valuation risks and market concentration concerns throughout letter.

Opportunity Density

70%

ScarceAbundant

Abundant (70%)

Manager sees abundant opportunities in value space with numerous companies at double-digit earnings and free cash flow yields. Describes value stocks as very attractive hunting grounds and identifies specific opportunities across small-cap universe, though acknowledges selectivity required.

Time Horizon

75%

Short-TermLong-Term

Decade+ (75%)

Manager discusses multi-year investment horizons with specific 3-5 year return projections for Lincoln Financial and 2-3 year outlook for Tutor Perini infrastructure benefits. Emphasizes long-term value realization and historical patterns of value outperformance over multi-year periods, indicating patient capital approach.