Bill Miller Isn’t Buying the Negative Take on SPACs
Recent downdraft has made some good blank check companies into enticing bargains, the value guru argues.
He has made a career out of spotting value. And that’s just what Bill Miller is seeing among SPACs, those red-hot merger vehicles that have recently cooled some, at least for now.
SPACs, the acronym for special purpose acquisition companies, had been on a tear since last year until they began a slide in March, as the number of filings for new ones waned. The Defiance Next Gen SPAC Derived exchange-traded fund (ETF), which tracks these instruments, rose a heady 31% since its October debut to February, then started to lose altitude and now is back to where it began.
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We had GameStop in our deep-value product, and I think our cost on it was around $4 or something, Miller said in an interview on The Exchange. When it got into the $70s is when we sold it, then it of course went to $400.
Shares of GameStop eventually retreated sharply from their Jan. 28 high of $483, falling below $50 at one point in February as the initial headline-grabbing short squeeze came to an end.
However, the stock has remained both volatile and in focus as the video game retailer announces steps in its digital transformation. GameStop shares closed down 3.55% on Tuesday to $158.53 apiece, putting the company s market cap at roughly $11.1 billion.