Burford Capital Share Discussion Threads

[old fool2] 25/7/2019 12:00

Yes. I have written to them they want proof!

[aishah] 25/7/2019 11:55

Shadowfall tweeting that they are short BUR. @ShadowFallCR

I remain long

[williamcooper104] 25/7/2019 11:54

I'm really not a trader - but have started trading on Bur - still think in the long run share price will reflect fundamentals - but markets can stay irrational for long periods (or until Woodford sells)

[williamcooper104] 25/7/2019 11:52

Anyone else finding HL all over the place offering dealing quotes well outside of share price bid/offer - did one trade well below and one accidentally above

[gareth004] 25/7/2019 11:33

Have faith all looking positive!

[f15jcm] 25/7/2019 11:29

I'm starting to think BUR is not worth trading/investing on anything but technicals. Results shoot the lights out and the share price falls. There's clearly a disconnect between valuation and growth. Very frustrating.

[cockerhoop] 25/7/2019 11:11

Hi jonwig,

I'm aware of the company explanation hence my assumption that it was an uncollected entitlement that has had to be written off.

I imagine though it was a couple of cases rather than spread across 18. I accept this is normal business and not particularly material but trying to understand the complete reporting path from profit being booked to cash received.

[williamcooper104] 25/7/2019 11:08

I've closed my spread bet and topped up on my core holding Don't do technicals/patterns - but the pop and then crash is too hard not to see/easy to trade

[riverman77] 25/7/2019 11:08

I see this is now down - utterly ridiculous although entirely predictable given recent price action. If I could have been bothered I would have sold first thing when it was up 7% and bought back after the inevitable dip, but not a trader and far easier to do nothing for a couple of years and wait for this to re-rate.

[smokybenchod] 25/7/2019 10:56

topped up at 16.31

[lomax99] 25/7/2019 10:49

Normal service resumed!

[mad foetus] 25/7/2019 10:47

Crazy market, just bought at 1650

[cockerhoop] 25/7/2019 10:07

I notice a couple of write downs from the 2011 & 2012 vintages reflected in reduced values for total recoveries - table page 9 compared to AR18.
2011 from $83.5m to $72.2m and 2012 from $119.4m to $116.2m

I'm assuming these are awards that have been unable to be recovered and so written off - any other views?

[winsome] 25/7/2019 10:03

DJ, Sadly I dont think CC analyst will eat humble pie. First, as Jonathan Swift once said, trying to reason with someone on something is impossible when that person reached their conclusion by using no reason in the first place.

Second, CC are house brokers for LTCM and their report on BUR basically said 'BUR is overvalued. Come one over to LTCM where you get much better value for money.'

[cockerhoop] 25/7/2019 10:02

Riverman77,

We don't know what Petersen is valued at internally do we?

We know that the previous trade sale notionally valued the case at $800m and the most recent 10% valued it at $1bn.

I'd imagine as you've suggested a realised gain of the difference between $100m & ascribed value would be booked but also a potential unrealised gain of the circa 60% holding remaining to reflect progress in the courts.

[gettingrichslow] 25/7/2019 10:02

What is the downside of seeking the US dual listing? If none, why aren't they just cracking on with it?

[stentorian] 25/7/2019 10:01

riverman77

The one-offs as you call them or "secondary market activity" as Burford call it. Have a look at 2016 Interim report where they comment at some length on SMA. Also "...the early stages of the emergence of a secondary market for our investments and our interest in participating in the development of such a market." p.13, 3rd para, AR 2016.

There will be more - they are a great tap to turn on and off.

[mad foetus] 25/7/2019 09:55

Remember that last year the share price was very strong post results until the placing perhaps with hindsight that satisfied an institutional demand that was chasing the shares higher. I'm not sure we've really seen that demand back, but surely these results won't go unnoticed. A US dual listing would of course be great.

[djderry] 25/7/2019 09:54

These are tremendous results on every measured metric.The returns,the commitments,the profits and the cash in hand.It's head and shoulders above every other player in the industry ( and I'm a shareholder in some).They've gone to great lengths to explain their accounts which are transparent and give both IFRS and non IFRS figures.The staff and management have,again,exceeded the most optimistic expectations.Finally,twenty questions for Cannacord Genuity;1,How does the humble pie taste? 2 to 20; see above.

[mad foetus] 25/7/2019 09:50

They go to lengths to explain why it is perverse to exclude the big winning cases. The whole argument seems to be that the future won't be as good as the past, yet every set of results shows that not to be true. Anyway, I expect significant buying over the summer.

[riverman77] 25/7/2019 09:50

Trident5 - regarding the 100m Perterson sale. Yes that would have boosted profits, but not by 100m - rather it would be the difference between 100m and what the 10% stake was previously valued at. I don't have the figures in front of me but would be a lot less than 100m. And who's to say there's won't be more one-offs next year (and the year after)?

[trident5] 25/7/2019 09:47

alphabet - yes - a realised gain only.

[stentorian] 25/7/2019 09:47

Alter Ego thanks for the link. It is such a slap down to the analyst it deserves to be set out in full (p.13).

"• Investments that conclude entirely in one fell swoop are simple: we do not report any recovery until conclusion, and then we report the entire amount recovered as a concluded investment.
• Single case investments that have partial resolutions along the way without the entire case being resolved, most commonly because one defendant settles and the remaining defendant continues to litigate: we report the partial resolution when agreed as a partial realisation and we allocate a portion of the investment to the partial resolution depending on the significance of the settling defendant
to the overall claim.
• Portfolio investments when a case (or part of a case) resolves or generates cash: we report the partial resolution when agreed as a partial realisation and we allocate a portion of the investment to the resolution. That allocation depends on the structure of the individual portfolio arrangement and the significance of the resolution to the overall portfolio but it is in essence a method that mimics the way an investor would allocate cost basis across a portfolio of security purchases.

One analyst has made the derisible suggestion that we should compute the return associated with partial resolutions against the cost of our entire investment, instead of engaging in the allocation process described above; we do not typically discuss analyst views but we discuss this point because of its deliberately sensationalised dissemination in the market. That is akin to saying to an equity investor who bought 200 shares of stock and sold 50 of them that the return on the
50 shares sold should be computed using as the denominator the cost of all 200 shares. To use a real Burford example, we made a multi-case portfolio investment in 2017 in which the Burford balance sheet invested $127 million. It is early days
still for that investment; thus far we have recovered $21.5 million from that portfolio and we have allocated $17.8 million of cost against those
recoveries in a classic example of a partial investment resolution. Therefore, we are reporting a $3.7 million gain from an attributable $17.8 million investment, with a 21% ROIC to date. That return will form a part of our total return disclosure,on a weighted-average basis. All of this is publicly disclosed on a line-item basis in our investment portfolio reporting. The analyst in question, on the other hand, would include all $127 million in the denominator of our ROIC computation the moment we have any recovery at all in the portfolio, which would treat the investment at present as generating $105.5 million of losses for
return computation purposes. We are unaware of anyone computing returns like that in any sector of the financial services industry."

They should have put in bold the first four letters of "analyst"