Burford Capital Share Discussion Threads

[billwave] 09/8/2019 11:46

Clocktower, the share price was down from 1500 to 410, I'd suggest the Hyenas have had their full meal, we are the vultures, take it or leave it but you'd better be quick with your decision. DYOR

[sogoesit] 09/8/2019 11:43

Williamcooper:
"But to my mind that’s more reason to abandon Fair Value"
Indeed, I think some of us do already ignore this intangible, not to say speculative, metric.

[hawkind] 09/8/2019 11:41

IQE P/E circa 400/500 vulnerable with previous 3 profit warnings and a BOD that are not as proactive as BUR directors in responding to claims. They go for easy targets or where the financial matrix is not easy to understand so can confuse investors as they did with BUR. It is clear MW are not privy to information on the inner workings of the business and clearly do not understand the fee payment structure. Also IQE will need further funding I believe. Let me add long term it is a 90% winner but it is vulnerable until demand drives up over next 2-3 years. There is a small risk of insolvency if they cannot raise capital to meet demand before profits come in. I still hold IQE but I am wary of short attacks. DYOR and IMHO

[williamcooper104] 09/8/2019 11:40

Bur have raised a legitimate point on case by case disclosure - which is that in a live case it provides helpful information to the other side But to my mind that's more reason to abandon Fair Value

[gettingrichslow] 09/8/2019 11:38

SweetKarolina, who has been doing mobile phones longer? Nokia or Apple? Who has been doing retail longer, Debenhams or Amazon? etc etc etc etc.

[1corrado] 09/8/2019 11:37

5000 at 753.1
5000 at 786.o
Looking to sell at 900p.

[1corrado] 09/8/2019 11:35

to much to read from you guys.......I am a day trader don't look at all of this only looking at the share price movement.Iat 786. have two lots 5000 at 753.1 and another lot as near as 5000 as well.Looking to sell at 900p.

[mad foetus] 09/8/2019 11:35

Adnan With Bogart and Molot owning close to 10% between them and Invesco and Woodford similar amounts, coupled with it being a person led business with strong US connections, if BUR were to go private it could happen very quickly at a price that shareholders couldn't do much to argue about.

[clocktower] 09/8/2019 11:35

Like a animal in the wild Burford is wounded, how serious those wounds are we do not know but with a pack of hyenas at the heels of BUR having smelt blood and seeing a the full meal, they are I suggest unlikely to give up on the chase and make sure they get a full meal for the pack and leave the last remains for the vultures.

[sogoesit] 09/8/2019 11:34

Clocktower:
If the premise is that BUR re-invest nearly all their cash gains into further litigation cases then on a net tangible asset base the NAV, based on cost accounting, is NIL.
I am sure I have seen a few folks on here recognise this. I recognise this.

The question is, as adnan17 is trying to answer, how to value the company to decide whether to invest or not. The market is trying to do this with a novel asset class which doesn't fit accounting rules and not succeeding in any tangible way. The analysts are working within an inappropriate rules' system or lack the imagination on how to cope with this.
At the end of the day, future outcomes are a statistical distribution. If analysts want they can easily work this out but maybe they're too idle or ignorant.

[williamcooper104] 09/8/2019 11:33

The property company analogy is a good one - revaluation gains are taken through the P&L but they are ignored - in the UK REITs are valued on NAV so P&L doesn't matter In the US they are valued on an income basis - but it's a recognised industry standard Funds From Operations which strip out valuation movements getting to net cash rent

[datait2019] 09/8/2019 11:33

Why would you suspect Iqe

[adnan17] 09/8/2019 11:32

I would not be surprised if some Private Equity or Sovereign Wealth Fund just came and bought it out. In addition, I would not be surprised if the Board is actively discussing this.

Could just say a value of 10x P/E giving a market cap of 3.5bn or 10x on the net cash return on cases. So case investments of 500m, return of 1,000m. So net cash return of 500m and apply a sensible multiple to that of 6 to 10x, so again of 3-5bn. Or Net Asset Value of close to 2bn and then apply a multiple of 1.5 to 2x, so again close to 4bn. So share price in the range of 15 to 25.

Private equity or Sovereign Wealth would be more patient investors and could wait 2-4 years until cases fully closed. The market wants to see positive return quarter on quarter, year on year.

In my opinion makes more sense for the Board to have those discussions as not sure stock market investors are the correct investors for this type of company.

[hawkind] 09/8/2019 11:32

Muddy Waters will not respond, they have made a killing opening a short prior to submitting the scandalous report, they will now slip away, hope Burford price recovers and slip away with their profits and move onto the next target. IQE I would suspect.

[sweet karolina2] 09/8/2019 11:31

The really interesting things about IMF Bentham are:

It has been going about twice as long as BUR.
It seems to be bigger than BUR in terms of the number of cases it has going and what it terms "Estimated Portfolio Value".
It makes a 1.5x return on what it puts in and claims a 90% success rate (mostly because cases settle rather judgments, which seem to be more like 50/50 - as you would expect there are no no-brainers that go to court).
Profits and cashflows are lumpy some years eg 2018 it makes a loss overall.

However the really interesting thing is overall it does not show the explosive growth and massive profits BUR report. Why is that.

Are Bentham doing it all wrong and BUR are geniuses?

Or is there something very dodgy with BUR accounting?

Or some other fundamental difference between the 2 businesses who seem to be operating in very similar ways in the same sector and just using a different accounting method?

[djderry] 09/8/2019 11:31

It's very hard to keep up with all the posts! I long for the days you might have one or two posts a day here.May I go back to post 8621,Edmond.You have a number of concerns.Firstly,you again mention mark to market.This is done all the time in many industries.As has been pointed out so many times,you can ignore that and look at the figures on a cash only basis.They are equally impressive.Again and again,the cash receipts are clearly stated.They come in,admittedly in a 'lumpy' fashion.Now,to their valuation.Again and again and again Burford's valuations are very conservative.Please look t their track record.(I'm sounding like a broken record!)Next,you seem to suggest that having ' fancy bar charts'is indicative of a company running away with itself,reminding you of the 'go-go' times!I thought they just made the statistics easier to read! Am I wrong? Finally,and most lamentably,you bring up a marital relationship and imply that 'valuation matters (could) losing independent rigour'.Where?How?.The company ,as we've seen has been deeply conservative in their valuation metrics.They have only written down the value on a concluded case on a handful ( two,I believe) of cases.

[minerve 2] 09/8/2019 11:29

"And aliens take over."

Brexiters already think they have! (illegal aliens)

We are drowning in them! Didn't you know?

Churchill wouldn't tolerate it would he!

LOL

[williamcooper104] 09/8/2019 11:29

Kirkie - when Bur realise an investment that they've previously Fair Valued they do not take proceeds less opening carrying value rather they take proceeds less cash invested - they then adjust difference out on the balance sheet The closing balance sheet is right but the proportion of realised to unrealised gains in the P&L is overstated - which is a fundamental point not only of trust but of the quality of earnings and the appropriate multiple on those earnings MW will respond - expect them to major on this and also on returns ex-Peterson

[gettingrichslow] 09/8/2019 11:28

Minny, have you noticed that you now feature in the Top Posts section at the top of the screen? Congratulations!

[hawkind] 09/8/2019 11:27

What a stupid statement, if everyone stopped selling or buying houses there would be no need for Estate Agents and what is their assets apart from the building ls they lease?......But will people stop selling houses??????

[billwave] 09/8/2019 11:27

I think Mad was being sarcastic ;-) ie they do have assets unless the world stops functioning as we know it. Libernum Capital, buy, target price £26.

[mad foetus] 09/8/2019 11:26

I don't know lionheart, just say a cut and paste of the headlines

[babbler] 09/8/2019 11:26

and riots... and war... and the world would end. And aliens take over.

[onjohn] 09/8/2019 11:25

Market leader, recession proof business, 40% growth rate

GARP

Growth now at a reasonable price

Could imho double

[sapper2476] 09/8/2019 11:22

Mad, and every shopper stopped shopping etc... etc...