Investment management company Miller Value Partners recently released its Q2, 2022 investment letter, a copy of which can be downloaded here. The firm faced notable challenges due to continued volatility in the last couple of years. In the second quarter, Miller Opportunity fund was down by -29.3%, extending its first half return to -31.08% net of fees. Over the last 10 years, the fund generated an annualized return of 11.83%. Take a look at the fund’s top 5 holdings to know their best picks for 2022.
In its Q2 2022 investment letter, Miller Value Partners analyzed and explained the reasons for its underperformance. The letter talks about Norwegian Cruise Line Holdings Ltd. (NYSE:NCLH), a cruise company founded in 1996 which operates internationally. The management of the Norwegian Cruise Line Holdings Ltd. (NYSE:NCLH) is expecting better returns in the coming years to cover its capital needs. Norwegian Cruise Line Holdings Ltd. (NYSE:NCLH) is based in Miami, Florida, and has a market capitalization of $4.686 billion. The stock of Norwegian Cruise Line Holdings Ltd. (NYSE:NCLH) closed at $11.18 on 26th July 2022. On a monthly time frame, Norwegian Cruise Line Holdings Ltd. (NYSE:NCLH) was down -3.37%, whereas its 12-month return dropped to -56.19%.
Here is what Miller Value Partners specifically said about Norwegian Cruise Line Holdings Ltd. (NYSE:NCLH) in its Q2 2022 investor’s letter:
“We do own Norwegian (NYSE:NCLH), which is back to levels not seen since May 2020. Norwegian is the boutique, premium brand. It has guided for a return to positive operating cash flow and adjusted EBITDA in the second half. Management expects to earn record adjusted EBITDA in 2023 and to generate enough cash flow to cover all its capital needs, including debt maturities. It trades at 6x 2023 earnings, well below its historical average of 11.8x.”
Although Miller Value Partners is invested in Norwegian Cruise Line Holdings Ltd. (NYSE:NCLH), the stock isn’t on the list of our 30 Most Popular Stocks Among Hedge Funds. At the end of the first quarter, Norwegian Cruise Line Holdings Ltd. (NYSE:NCLH) was in 35 hedge fund portfolios compared to 40 funds in the fourth quarter of 2021. Norwegian Cruise Line Holdings Ltd. (NYSE:NCLH) shares lost 54.57% of their value over the last 52 weeks.
In February this year, we published an article on Cruise Line Holdings Ltd. (NYSE:NCLH) in which we shared the views of another hedge fund on the company. If you want to read more investor letters from hedge funds and other leading investors, check out our hedge fund investor letters 2022 page.
Disclosure: None. This article is originally published at Insider Monkey.
