Miller Value: “Farfetch (FTCH)’s Value Alone to be Worth More Than the Entire Company Today”

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 have an idea about their best picks for 2022.

In the Q2 2022 investment letter, the firm analyzed and explained the reasons for the fund’s underperformance. The letter discussed the performance of the stocks like Farfetch Limited (NYSE:FTCH). It is an American online company for luxury goods that has a market capitalization of $3.112 billion. The stock of Farfetch Limited (NYSE:FTCH) closed at $8.16 per share on July 27, 2022. Farfetch Limited (NYSE:FTCH) had a return of 13.97% for the past month whereas its 12-month returns dropped to -83.78%.

Here is what Miller Value Partners specifically said about Farfetch Limited (NYSE:FTCH) in its Q2 2022 investor’s letter:

“Here, too, we see some extreme valuations. We’ve written about the potential we see in Farfetch (NYSE:FTCH), a luxury goods marketplace and aspiring technology platform for luxury. FTCH has also acquired several traditional luxury goods companies over the years, the largest being New Guards Group (NGG), a collection of brands. It also owns Stadium Goods, a stake in Neiman Marcus group, Browns and several other assets. Many of these businesses are already profitable. We calculate their value alone to be worth more than the entire company today! At the current price, you get a free option on the whole marketplace and platform services business.”

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Our research shows that Farfetch Limited (NYSE:FTCH) stock failed to make it to the list of 30 Most Popular Stocks Among Hedge Funds. Farfetch Limited (NYSE:FTCH) was in 45 hedge fund portfolios in Q1,2022 compared to 47 in Q4,2021. Farfetch Limited (NYSE:FTCH)  shares lost 82.33% of their value over the last 52 weeks.

We published another article last month on Farfetch Limited (NYSE:FTCH) and shared Polen Capital’s opinion about the company. Please check out our hedge fund investor letters Q2 2022 page for more investor letters from hedge funds and other leading investors.

Disclosure: None. This article is originally published at Insider Monkey.