Burford Capital Share Discussion Threads

[sweet karolina2] 15/8/2019 13:01

I think we now understand why the BUR business model is so successful. The deal seems to be lose one case and on top of the fees and costs you have to pay to the other side you pay us 6 times as much but if you lose a second case you only by us a third of what you paid for losing the first case.

No wonder IMF Bentham, with its no win no fee model, only makes a fraction of the profits BUR does - it clearly has nothing to do with BUR aggressive revenue recognition after all. Indeed the dubious ROIC's MW highlights on cases won pale into insignificance compared to the returns BUR makes when its clients LOSE!

It is no wonder BUR have to keep raising debt and equity in order to provide the funds for the massive queue of potential litigants who want a deal like that.

[winsome] 15/8/2019 13:01

This MW thing has all the hallmarks of short seller Viceroy's baseless attack on Capitec bank nearly 2 years ago. There was little behind the accusations and Capitec's share price recovered to over 40% above the price it was before the short eventually.

hxxps://www.businesslive.co.za/bd/companies/financial-services/2018-09-26-capitec-benefits-as-its-active-client-base-expands/

Bearbull misses the point that incoming cash has been flowing out into new litigation investments. Otherwise how else is the company expected to grow. I think this is more about hitting Neil Woodford's holdings one by one. They are easy targets and Shareprophets in particular seem to be intent on bringing the man down and innocent shareholders are collateral damage.

[monte1] 15/8/2019 12:47

#10878 see #10854

[galatea99] 15/8/2019 12:40

Mr Bearbull of Investors Chronicle on Burford.

Quite a long commentary that starts:

"It should be obvious why I am writing about companies that run a mismatch between profits and cash flow. It’s to do with the fun and games at litigation financier Burford Capital (BUR). It wouldn’t surprise me if Burford is a can of worms. Yet the point isn’t to pass judgement on it. That’s why a PDF of the Muddy Waters research sits unread on my desktop, lest it influence me. Rather, the aim is to draw investors’ attentions to the type of company that Burford might be, or Aero Inventory was.

That said, the ‘safety’ spreadsheet could have been written with Burford in mind. The company may set records for the gap between accounting profits and cash flow (see table). While operating profits rose almost eight times in the four years to end 2018, cash flow resolutely went in the opposite direction. As a result, over the five years 2014-18, $363m (£295m) of cash left the group before interest and taxes while the income statement simultaneously totted up $863m of operating profit. And in the most recent year – 2018 – the gap between profit and cash flow is a mind-boggling $543m."

........................

"These are the sort of shares that I would only consider buying at a steep discount to net assets, whose value – almost by definition – is tentative. In Burford’s case, the latest net asset figure is 573p a share. So, even at the current 808p (down 60 per cent from its 12-month high), the share price would have to halve, then drop some more before I would take an interest. Even then there is the issue of its corporate governance – idiosyncratic or risible? Has anyone noticed that next month all four of its four-man board solely comprising non-executive directors will cease to be independent? Still, as I say, it’s not really about Burford."



"It wouldn’t surprise me if Burford is a can of worms"!

This is one of IC's flagship columns.

[monte1] 15/8/2019 12:29

#10868

A not unreasonable finding to be made by the arbiters.

Did Glenmark sell it’s own products?

In any event, if they did, that finding merely requires them to make a contribution towards liquidated costs already incurred under the collaboration agreement.

It is not an award of damages.

[williamcooper104] 15/8/2019 12:26

Anyone any idea as to what the mark on the Peterson case might have been as at last reporting date Curious as to how much the NAV ought to have been reduced as a result of the recent elections Had thought that around £6 was the floor - but that is now all other things being equal, lower - question is by how much It's possible that management were super conservative on the length of time the litigation would take to conclude which would then give a write up when the case is settled which could bet against the credit spread movement (at least that's what I would do)

[williamcooper104] 15/8/2019 12:17

We still have no idea as to how recent share purchases are relative to our shadow directors cash compensation

[1corrado] 15/8/2019 12:16

725 next stop

[williamcooper104] 15/8/2019 12:16

Insider purchases are no guarantee of success it's more that a lack of them is almost a guarantee of the worst

[pal44] 15/8/2019 12:14

its following the Ftse today i think .. wait for the yanks to crunch up GLA

[williamcooper104] 15/8/2019 12:14

Yep - and even in better times Bur had a much higher beta than you would think it had (around 1)

[1corrado] 15/8/2019 12:13

750 has been beaten where next below725

[adnan17] 15/8/2019 12:12

SK, how low will you go. Just to give you one point that ends this dispute. Read the following very clearly

"if Glenmark subsequently decides to enter that country by marketing the Napo Product or by registering ITS OWN PRODUCT based upon Licensed IP related to that Napo Product, then Glenmark will REIMBURSE Napo for FIFTY PERCENT(50%) of the expenses associated with conducting those clinical trials and obtaining the regulatory approvals for that country."

So even if Glenmark register its OWN Product,then they will have to REIMBURSE Napo. Do you know what REIMBURSE means?

So Glenmark cannot sell any of the Products without their being a payment to NAPO.

And finally Burford takes a cut.

[1corrado] 15/8/2019 11:43

ftse will go below 7000 as predicted......................keep your hat on as it will be rocky.

[bbmsionlypostafter] 15/8/2019 11:37

Remind you of anything? Sometimes multiple Director share purchases per single day, 4in 1 day is the highest I spotted.

It didn't work there either.

[sweet karolina2] 15/8/2019 11:33

So why were Glenmark awarded costs and fees? Ie the only transfer of cash on settlement from one party to the other.

What do you estimate the costs of an arbitration like this one is for each party?

If Glenmark brought the arbitration to stop Napo from charging them too much and to not have to use Napo as exclusive supplier, has Glenmark got what it wanted from the arbitration?

You still have not in anyway justified the case as conceivably providing a return to BUR as its cut of $15.8m

The fact that Glenmark is a proper business with significant resources tells me they are no mugs and did not bring the arbitration to shakedown Napo for damages (arbitration is not the way to do that anyway) just the aims I suggest and aims I believe Glenmark achieved.

I am afraid that while your research is good your analysis is so badly tainted by optimism and confirmation bias you are doing your understanding and therefore your investment decision making more harm than good. However keep trying as I have said before the skills needed do take a long time to develop. Maybe you should try to develop critical analysis skills in areas where you do not have inherent optimism and confirmation bias.

[monte1] 15/8/2019 11:28

LOL

Would you expect Napo to give Glenmark the goods for free? That would be a rather unsuccessful business model dontyathink?

There was NO award in Napo’s favour therefore why would BUR be due a penny on a no win no fee basis?

[gettingrichslow] 15/8/2019 11:28

Adnan, either they are deliberately not understanding or they are a bit slow. I think it’s the latter, but either way, it’s just embarrassing...

[henchard] 15/8/2019 11:28

adnan, perhaps it might be worth contacting BUR investor relations and asking them if they can confirm the $15m came from the Napo/Glenmark case?

[gettingrichslow] 15/8/2019 11:24

I’d pay to NOT hear any more of this guff...

[adnan17] 15/8/2019 11:21

Have you lost the plot? Fact of the matter is there is a transfer of money/asset/something of material value from Glenmark to Napo. So Napo can continue Supply products to Glenmark. Those products will have value. Glenmark pay a mark up. And finally Burford take a cut of that. I.e. Burford take a cut of any settlement.

You not understanding that beggars belief. Its very deceitful you continuing to misconstrue what a settlement is. Very deceitful on your behalf.

[bbmsionlypostafter] 15/8/2019 11:18

OzzMosiz
15 Aug '19 - 11:14 - 10855 of 10856
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bbms filtered as well. Filter list is getting long now.

Good move. Filtering the bear side worked out BRILLIANTLY for the punters at QPP, CTAG, GBO, about a million Chinese outfits & many other companies.
.........................................................
Stop Henchard! You'll confuse them. Actually, you prolly won't since they don't read it anyway. They'll also have missed the bit where TW says, in his opinion, MW broke the law & may be guilty of market manipulation. Doesn't fit with their narrative anyway.

Henchard
15 Aug '19 - 11:17 - 10857 of 10858
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To be fair to Shareprophets, it hasn't posted uniformly negative material on BUR.

[henchard] 15/8/2019 11:17

To be fair to Shareprophets, it hasn't posted uniformly negative material on BUR. There was the following (albeit before MW came on the scene):

"A senior accountant looks at Burford Capital (28 June 2019)

With the added bonus that kiss of death. disgraced fund manager Neil Woodford is a major shareholder, the bears are certainly sniffing around litigation funding giant Burford Capital (BUR). Our own Nigel Somerville expressed his concerns here. One bear (Paddington) has asked if this is the new Quindell (QPP) in terms of revenue recognition. So I asked a former partner of a big 4 accountants to review the 2018 accounts. He notes ..."

The review by the former partner was quite favourable to BUR.