Burford Capital Share Discussion Threads

[mad foetus] 11/8/2019 14:00

I think there is a valid question to be asked about whether BUR is right to be listed. Unless you accept their pricing approach - which I do - then the returns would be absurdly lumpy. But the degree of trust and patience required seems to be beyond the limits of the market these days. I know that a number of UHNW families are looking at getting exposure to litigation funding, and I think a private limited partnership structure with commitments being called down when required would in many ways be better suited to BURs model. But it would be yet another occasion where a lucrative and uncorrelated asset class is placed beyond private investors

[lomax99] 11/8/2019 13:59

Hardly worth the wait, convenient they were preparing to make a comment....

[buywell3] 11/8/2019 13:49

Tomorrow is going to start what should be a very interesting week

The BUR story has a long way to run yet for sure

Fortunes will be won and lost in a day or even in an hour

Day traders love this sort of action

Such volatility is rarely seen on a daily basis

And in a backdrop of a coming market meltdown

Perhaps a film should be made of this one , buywell would like to put his name forwards as a script writer.


Rate is $10,000 per day BUT as one can see looking at my back catalogue of posts , my output is large ---- and the quality excellent .

[tsmith2] 11/8/2019 13:48

It's just a half hearted generic comment, nothing more. Looks like shorters are good to get squeezed on Monday if that's it.

[adnan17] 11/8/2019 13:48

Nigwit, I agree with your analysis. I've owned Burford since they were at £1.73 and still have full faith in them. I could easily cash out right now. But why cash out when I believe they will continue to go up.

Interesting to see that Gotham City short attacked a company called Ebix in early 2013, when the share price was at USD 19. It fell to USD 11. But then if you held on it rose from USD 11 to USD 85 in 2018.

My gut feel is that this could happen again here. All of MW's poor research were answered. Their research was torn apart particularly on Napo and Neptune. Just lies to be completely frank. And their cash flow anaylsis was extremely amateurish.

I've attempted to value the company through multiple lenses, P/E, NAV/Book value, and Cash Flow. Through all the metrics I get to a £3-4bn company valuation. If they continue to win case which I believe they will do then the value should push higher at £5-6bn.

[riverman77] 11/8/2019 13:47

I'm really not worried about financing - 400m cash, steady flow of realisations, ability to sell some cases if needed, capital from SWF, no debt repayments till 2022 and modest overall debt.

[nigwit] 11/8/2019 13:46

Stoxx67

Just click on the 'Investor Relations' link here but please don't swamp them. I am sure they have much to do right now and need to concentrate on details for the sake of every investor. I just wrote to offer support, not to question them.

[williamcooper104] 11/8/2019 13:41

Bloomberg have some further details of Gothams argument Seems to be focused on it being bad to use debt for litigation claims https://www.bloomberg.com/amp/news/articles/2019-08-11/short-seller-gotham-says-burford-is-inappropriately-financed?__twitter_impression=trueIf that's all Gotham have then doesn't look too scary

[stoxx67] 11/8/2019 13:40

NigWit

would you advise as to EOC email address please, as i too would like to make contact

many thanks

[riverman77] 11/8/2019 13:37

There are lots of candidates - a consortium of legal firms, private equity, sovereign wealth funds.

[mad foetus] 11/8/2019 13:34

I can think of someone who might want to take this over and then run it down. Argentina.

[jeff h] 11/8/2019 13:31

Jeff H9 Dec '18 - 13:55 - 4117 of 9342 Edit

I asked the company would they consider introducing quarterly updates due to in general only receiving fresh information about trading etc in the Interim and Final statements.

Their view was it would not provide any meaningful additional information that would improve visibility on the performance of Burford but would be expensive to produce as the valuation exercise they conduct is long and time consuming.

I suggested then an update with things such as cash generated, new levels of commitments, developments in geographical markets and comments on areas of the business such as Insurance.

FD Elizabeth O'Connell says she will note my comments and suggestions.

I do feel with more frequent trading updates we would smooth out the large ups and downs in the share price, what do other posters think?

................when writing to EOC last December I made the following comment:-

"Yes I enjoy and welcome all the disclosure Burford makes in its results and annual report announcements, and it is a pleasure to read about all the progress the company is making when the company reports its figures, but as a shareholder I do not get to read enough updates!... hence the request for quarterly of periodic updates to supplement the Interim and Final Results announcements.

With the accounts of Carillion and Patisserie Valerie proving to be works of fiction I dread a bear/short attack from say a hedge fund querying the Burford accounts, after all the company refuses to comment on analysts forecasts, does not give trading updates (except for exceptional investment results), has over $1 billion of Investments on its balance sheet which are not verifiable and for reasons of confidentiality refuses to comment on the vast majority of the litigation cases it is financing!!....more frequent trading updates disclosing cash generated etc in my opinion would help to dispel these fears, though as we have seen the Patisserie Valerie claimed "cash" balance proved to be illusory."

[sweet karolina2] 11/8/2019 13:29

buywell,

One is no longer trading, the other is IMF Bentham which has been going longer than BUR.

Jamie Nimmo claims he had seen the report. The essence of the report seems to be: BUR looks too good to be true, because it is not true.

It is also worth bearing in mind that the share price when the PE firm employed Viceroy Research could have been around what it is right now.

[riverman77] 11/8/2019 13:24

As others have pointed out this looks ripe for a private equity buyout. Woodford,Invesco and management would probably all be very keen to offload at a reasonable price (I'd be angry at anything below £20). Parallels to PTSG - this also crashed following a shorting dossier (albeit less high profile) and was soon afterwards bought out at about 3x the then market price.

[sidjameslaugh] 11/8/2019 13:17

You might want to do your own research instead of quoting stuff from the daily
Mail and twitter.

[buywell3] 11/8/2019 12:57

Have you discussed the report in a sunday paper today that BUR were looked at a few years ago by an independent researcher who was paid to do a report by another company
that was mulling making an offer. ?

The upshot was no offer was made

My reading of it was that two other legal type companies similar to BUR were used as a comparison with BUR as part of the report.


I believe both are no longer trading


dyor

[winsome] 11/8/2019 12:46

sk, someone posted a link on here earlier this year to an article about Gray not being able, so far, to find a litigation funder to finance their case against BUR. Gray, being bankrupt, have no money of their own to do it. I can't recall the link details and given the thousands of comments on here I'm not going to search back for it. Someone else might oblige you.

[sweet karolina2] 11/8/2019 12:39

"she has confirmed they are investigating illegal market manipulation."

"or will they continue to play ping pong with the shorters and further undermine credibility with stupid legal treats? The nature of lawyers is they will go for the latter rather than the former, but we shall see."

[sweet karolina2] 11/8/2019 12:37

William,

Agree change of auditor is more about perception than reality as auditors do far less than people think they do:

Liz has been in accounts dept from day 1, taking on more and more responsibility. Same auditor used every year and therefore she knows what he will look at and what he will just accept. Everything was plodding along relatively well until 2014, when growth started going exponential. From 2014 CFOs leave on an annual basis, but Liz is one constant with the auditor the other constant, until Liz officially becomes CFO.

Not saying anything dodgy has happened, though the stench over Napo has not fully cleared, but it is easy to see how more dodgy things could happen and why both things need to change to clear the matter up.

[nigwit] 11/8/2019 12:34

I received a reply from Elizabeth already. I won't publish it verbatim since it’s addressed to me personally but she has confirmed they are investigating illegal market manipulation.

[sweet karolina2] 11/8/2019 12:19

winsome re 9331,

Is that what you know to be fact or just what you believe. If it is what you know how do you know it?

The Gray issue was a contingent liability, but never treated as such (contingent liabilities are just that they do not necessarily materialise). I certainly recognise what you are saying about the super yacht fiasco, it is indeed all part of elaborate and unpredictable games, which defy valuation. The point is when the worst case outcome for BUR is not ZERO return on what has been invested but is actually a negative that needs to be in there as contingent liability.

I have raised the question many times and each time posters on here have ducked it. Why is BUR able to report stellar profits when IMF, in the same business for longer don't but instead produce genuine (as they only account on actuals) but pedestrian.

The answer to that might be that IMF are investing in pedestrian cases but BUR are into a much higher risk / reward part of the market. If that is the case then the risk side is being massively downplayed vs the reward and there is already undisputed evidence that BURs accounting exhibits that in specific cases and a lot goes unnoticed underneath exceptional cases like Petersen.

The big question now though is will BUR do the right things to put all this right and re-establish trust (to a large extent that would involve tacitly admitting that shorters were right) or will they continue to play ping pong with the shorters and further undermine credibility with stupid legal treats? The nature of lawyers is they will go for the latter rather than the former, but we shall see.

[williamcooper104] 11/8/2019 12:08

Sk - you cannot make provisions for contingent liabilities - IFRS much stricter on provisioning than UK GAAP was as the later was easily fiddled with "cookie jar" provisions Not sure change of auditor would do much - however having a proper CFO who is actually on the board and not married to the CEO would do a lot

[nigwit] 11/8/2019 11:58

Hello again

I've been invested in Burford since it was well under £4 a share, about three years ago.

I once wrote to their investor relations address with a simple question about Petersen and I received a polite, personalised reply from Elizabeth O'Connell within 2 hours - that was across time zones too. I sent a supplementary question and received an even faster personalised supplementary reply to that as well. I was impressed. In my experience quick personal responses from top people are always the mark of a good business run by people you can trust.

Whilst I get the concerns about governance that stem from the close relationship the principals share I see it as a positive in this case. It makes Burford more like a family business in which the Bogart and O'Connell have complete, forensic knowledge of every tiny aspect. Businesses like this, where those running them are in complete control and appear to be everywhere at once are always much more than the sum of their parts. This view was reinforced for me during the investor call last Thursday.

So I think MW were precipitous and jumped the gun. They drew attention to some legitimate questions but I'm confident that Burford had all the answers and will continue to out-maneuver and neutralise any more heat-seeking missiles from the periphery.

I'm excited for the next few weeks. Last week's gales may turn out to be a blessing that blew away a few cobwebs of doubt that had been lingering all year so clearing the way for the company to be better understood and for its shares to reach new highs in the fullness of time, perhaps as soon as issues around Woodford have been resolved.


Anyhow, I just wrote this to Elizabeth to express my support.

"Hello Elizabeth

I am sure you're getting swamped with email from investors so I’ll keep this brief.

I’d like you to know that I think MW were right about one thing and that is that Burford is a trust play. That’s because it’s a complex business so it’s not possible for investors or commentators to get the complete picture in hi-res, full colour.

I’m alright with that though because I trust you, Chris and your team not to take chances.

I’ve more than doubled my investment in the last few days.

Go get em!"


Let's see if I'm right.