Burford Capital Share Discussion Threads

[elcapital2018] 09/5/2019 08:21

Ive bouoght back. Enjoy your elves. Nice quick quid a share.

[lomax99] 09/5/2019 07:26

Shares have added another paragraph:Canaccord argues that Burford's claimed 85% ROIC is misleading and it believes the 'real' return on concluded investments is 51%. It believes that going forward the company should reference the lower number in all of its reporting.The broker has cut its 2019 and 2020 earnings forecasts by 18% and has questioned whether Burford will be self-funding by the end of the year or whether it will need to raise more capital, diluting returns for shareholders.In Burford's defence, the company complies fully with IFRS accounting and it is the accepted norm to assume a fair value for the portion of investment which is ongoing while cases are pending final settlement.

[lomax99] 09/5/2019 06:11

It's ok. I actually get the digital version free via my AJ Bell account - it's available on their website as long as you hold at least £4k of assets on their platform.I subscribe to IC, which I prefer. If I did not have free access to Shares, i would not drop access to IC if it was a choice between the two.It's a shame their BUR piece did not tackle the flawed logic of attaching full cost to a part realisation when calculation the IR.

[williamcooper104] 09/5/2019 06:02

I’ve been with IC for years out of habit - question how useful I’ve found it in recent years

Interesting re size and complexity of claims - suggesting IRRs could fall but we don’t really need historic IRRs, just a bit of regular consistency or even regular inconsistency of earnings

Ability to deal with size/complexity and take distressed loans means Bur well placed to make hay when (not if) the US high yield bond market blows up

[jonwig] 09/5/2019 05:46

Thanks for that, lomax. I've been mulling over whether to subscribe to Shares Mag - £125 pa looks reasonable. What's your take on it? (I've been with IC for years.)

[lomax99] 09/5/2019 05:39

Shares magazine today:Why criticism of Burford Capital is unfairIt has been a trying time recently for Burford Capital (BUR:AIM) after analysts at broking firm Canaccord Genuity cut their earnings forecasts and their target for the stock.The broker has challenged Burford's claimed 85% return on invested capital (ROIC) and argues that future returns may be lower than the market expects. It also suggests that the firm may need to raise more capital.Therefore, it argues, the current valuation doesn't reflect the risks involved in owning the stock and it has cut its target price from £15.43to £11.96.On the day the broker published its note(30 April) the shares lost 118p or nearly 7% of their value to £16.35, and since publication the shares are down over 200p or 11.5% to £15.50.NO QUESTION OVER THE GROWTHLitigation finance is a highly attractive business which continues to grow quickly and Burford has successfully built itself a market-leading position.In its first year of business almost a decade ago, it received 131 enquiries for funding. Last year it received 1,470 enquiries for funding, so there is no lack of demand.However income can be very 'lumpy' as investments take between 18 months and two years on average to come to fruition.Over half of the enquiries that entered Burford's underwriting pipeline last year were related to cases where the estimated damage claim was over $100m. Typically the bigger and more complex a case, the longer it takes to settle.By its own admission, Burford is now more like an investment bank for the law business than a litigation funder. Last year it committed $1.3bn of funding, more than three times the amount it invested in 2016, as well as launching a $1bn 'strategic capital relationship' with one of the world's biggest sovereign wealth funds. SHARES SAYS: Take advantage of the pullback to buy more shares.

[williamcooper104] 08/5/2019 11:08

That’s the total return on ivestment - presumably Bur paid a premium for it so returns to Bur won’t be as good

[williamcooper104] 08/5/2019 10:49

Think it means c1.95x in 18 odd months

[alter ego] 08/5/2019 10:37

and from March 2018 -see page 5

[alter ego] 08/5/2019 10:31

more about this in article first published in March 2017

[mad foetus] 08/5/2019 10:21

It could do with being clarified, agreed

[arregius] 08/5/2019 10:18

Yes but i still dont understand it. In thar article the return was to be bigger and now we are getting 25m as bondholders.

[jeff h] 08/5/2019 10:04

This is what Burford previously said about the what Arreguis above refers to:-



"Last year, the trustee held a bankruptcy auction for a $50 million chunk of the judgment, as the trustee’s resources dwindled to $670,000. In September 2016, Gerchen Keller Capital LLC [later acquired by Burford Capital], purchased that $50 million judgment for $26.2 million in cash, providing funds to the estate to fund the litigation and be distributed to creditors."

[arregius] 08/5/2019 09:15

Anyone with access to this article? https://www.wsj.com/articles/magcorp-trustee-proposes-47-million-payout-to-bondholders-11557266717I believe burford is finally getting cashed in here

[brexitplus] 08/5/2019 07:37

Galatea

Interesting article in IMF Bentham. Change the name to Burford and apart from the insolvency aspect very similar.

[galatea99] 08/5/2019 06:08

Here is a quite detailed look at IMF Bentham.

[riverman77] 07/5/2019 17:29

The consensus seems way too low in my opinion - brokers are saying eps is going to be lower in 19 than 18. This is despite the massive step up in investments over the past couple of years which is going to start coming through. Plus the performance fees from the asset management side. I'd put it on a pe of around 11 at current share price.

[elcapital2018] 07/5/2019 17:23

I didnt close. This looks very weak.

[jonwig] 07/5/2019 17:03

Incidentally - at 1508p, 2019 per is ~14x on consensus, and brokers are SB8 vs SS1 (ShareCast).

[jonwig] 07/5/2019 16:57

chris_e - Gosh, strong stuff! Whilst it's a convincing rebuff to the USCofC lobbying, will Congress be convinced?

To borrow the words of Georgetown law professor J. Maria Glover in a closely related context: “These decisions thus arguably reflect a recognition that permitting discovery into [financing arrangements] effectively constitutes a tax on the plaintiffs' use of litigation funding. They recognize that permitting discovery of these materials may in fact so sap the plaintiffs' resources that the defendant may achieve indirectly what the litigation funding arrangement was meant to solve in the first place, by undermining the level playing field that litigation finance was meant to provide.”

It sort-of reinforces the point I made earlier today, that The Law is a major frictional cost of doing any business in the US. Imagine having to keep a lawyer on the phone whenever you dine out or buy your groceries.

[chris_engel] 07/5/2019 16:42

Interesting development regarding the disclosure of litigation finance:


"Another Federal Court Declines to Permit Discovery of a Litigation Financing Agreement"

* In commercial litigation, discovery has become a war of attrition in which the better-resourced party has an almost insuperable advantage.

* Recently, deep-pocketed litigants have treated the growing use of litigation finance as a pretext to draw out the discovery process by seeking disclosure of confidential financing arrangements.

* Allowing such discovery is irrelevant to the merits of the case, and unduly burdens both courts and those litigants who avail themselves of financing.

* Courts across the country are increasingly refusing to permit discovery of litigation financing documents, describing the use of financing as “a side issue at best.”

* The Eastern District of New York is the latest court to weigh in on the issue, in a case called Benitez v. Lopez.


Here is the full article:

[minerve 2] 07/5/2019 16:19

BOOM!

Having fun everyone?

ROFLMAO!

[minerve 2] 07/5/2019 16:19

THIS COULD GO MUCH MUCH LOWER!

LOVELY JUBBLY!

[alpha inu] 07/5/2019 16:16

Thx a lot. Very useful