Burford Capital Share Discussion Threads

[williamcooper104] 02/9/2019 20:17

IMF don't Fair value - so would need to adjust for that - but then IMF (I think) trade at a premium to NAV - as does LIT The bear case is to value Bur as an investment trust - but if you do that you have to Fair value - what listed investment trust doesn't? The question is whether the marks are reasonable and given that the largest fair Value adjustment was backed of with actual third party sales I don't see this as a problem (whether it's worth less now is a separate issue)

[dgdg1] 02/9/2019 19:15

Rar100, sorry to hear it hasn't gone well for you. No-one can be sure of the truth, but for me I just don't see any evidence of any wrongdoing or even anything looking dodgy. Of course that doesn't prove there isn't anything but I don't see a reason to be more concerned after the MW attack than there was before, or to be more concerned than about any other company for that matter - any company could secretly be fraudulent, but generally we don't assume that unless there is something to make us suspicious, and I haven't seen anything suspicious here, despite all the mudslinging.

Argentina - it's very unclear how much effect this will ultimately have, if any. For people who value the company based on the future likely ex-Petersen earnings it's not relevant. I have made a spreadsheet where I have guessed that Burford use a fair value based on different percentages of the implied fair value of the claim based on the sale prices they achieved in different years. (Burford have stated that they haven't used the full impied sale values). Admittedly they might not have always used the same percentage, but this is just to make a rough guess. I assumed 40% for 2016 as there was only a small sale. After that, asuming they have used 60%, the ex-Petersen profits in 2017, 2018 and the first half of 2019 were $123m, $142m and $106m, so say $220 for the full year 2019. Assuming 75% the figures would be $74m, $106m, $99m, so again say $220m for the full year. So say $200m after tax. Then I assume there would be another case every 8 years which would be half the size of Petersen, say Petersen is $1bn profit so that comes to $62m a year. So say yearly profits are $282m and of course increasing fast. Profit after tax is then about $250m and eps about 95p with a good increase rate, so it should justify a pe of 20, so a fair valuation of 1900p say. All very rough but you get the idea.

Timescales - they said they were hoping for Q1 of 2020.

Suing MW - I would just ignore that whole issue, if they do end up getting somehing from MW it's a bonus.

The price going down after good results I believe is due to shorters.

But in practice if you are worried why not compromise by selling part of your holding?

[rar100] 02/9/2019 19:01

qruz

Good question

I have wondered that myself, I'd like to see the both in accounts so as to decide for myself (I'd probably opt for dead in the middle of the two).

[qruz] 02/9/2019 18:53

William,

Any idea on a share price number if BUR applied the same accounting as IMF Bentham? Same as NAV ?

[dgdg1] 02/9/2019 18:45

I think the share price pattern on good news may be because hardened bears take advantage of the price increase to short (either because they genuinely think this is a better opportunity to short or because they want to make sure no-one sees it as good news, so they manipulate the price down), then that influences others to believe that the good news wasn't really good and must have had something nasty lurking in it, so they push the price down even more - just a theory.

[rar100] 02/9/2019 18:45

So what should Bur do to convince the market that it's business as usual, making heaps of cash still and the share price will be back to £15 -£20 in what time scale. That's what I'd like to hear in some form or other.

Argentina is looking like a hit to Bur also, but to what extent?

Whats their time scale for listing in US or FTSE?

Are they going to sue MW over the market manipulation ? Can they?

How's business now, are they still doing good volumes?

Frankly Bur is an impenitrable muddy water to me at present, but I'll hold in hope that it will turn around and also won't be surprised if it goes to zero and they get done for outright fraud.

They don't clear the waters for me, but there again I also don't know what they should be doing - I'm just a small investor with a busy life and have had winners and losers.

This one is a real loser for me, my second biggest holding after good old solid Fundsmith.

I was going to sell Bur just before the attack and put the proceeds into F'smith, just didn't get around to it.

The last two end year and interims looked good but the share price went down, so I wasn't too impressed, not good charts for a long time.

That's my 2p's worth, I'd write to them but I don't have the depth of knowledge required to have the necessary impact.

But I'm a very unhappy investor with Bur that makes me think I stand more of a chance of losing the lot rather than they turning it around.

I don't know if i can trust them to be 'good' people or sharks that have been hooked on a line and then fried.

I would imagine there is a lot of Long term investors that have similar feelings.

Maybe they should read this post......

[winsome] 02/9/2019 17:22

Of much more importance is their next RNS re accounting and further disclosures. NAPO is a damp squib that's now history and one for FCA to file in the bin. Proof is TW's headline point that Nomad's name not mentioned? Is that the best the shorters can do. I suggest he addresses the many big red flags with Optobiotix. That'd keep him busy for a week or two.

[williamcooper104] 02/9/2019 17:09

V hard Same pattern intact - bit of good news stock pops then falls lower than before the good news Has been like this well before MW No idea when/where bottom is - and fools errand to seek it But NAV is c£6 - or say £5.50-75 if you adjust for Peterson (in v crude way)At NAV given track record it's exciting There's a whole earnings/nav debate - but that doesn't matter when the share price is around NAV - and if they can do 20 plus IRRs with no economic cycle risk then you won't be upset

[1corrado] 02/9/2019 17:06

where is the bottom 000p.............................

[podgyted] 02/9/2019 16:51

Warren Buffet would not invest in BUR after today's missive - he'd simply put it in the "too difficult" tray.

Looking at the price action today a lot of others have too.

[qruz] 02/9/2019 16:46

Too hard to a call a bottom on this one, where is going to go? Sub 600 like the Canaccord target?

[1corrado] 02/9/2019 16:41

679 at the close not good at all.

[wardy333] 02/9/2019 16:39

Massive row of A/T sells to end the day and a low U/T, the City is going for the jugular here , how low they can get it is unknown ;like I said earlier it should rebound but when?

[winsome] 02/9/2019 16:37

The shorters very unhappy now NAPO issue put to bed. Let's look at a real pharma fraud - Optibiotix - promoted relentlessly by TW for years but never generates the profits it promises. Pot, kettle, black. Even after last week's dramatic profit warning and slump in share price he shouts 'its a screaming buy!'

These guys aren't interested in truth or real reporting, just pushing their own agenda

[djderry] 02/9/2019 16:33

Thanks to the bears,another 2651 shares added to the ( tens) of thousands in the portfolio.

[yidarmytom] 02/9/2019 16:31

He like companies with a great balance sheet and growing free cashflow

[yidarmytom] 02/9/2019 16:31

He like companies with a great balance sheet and growing free cashflow

[adnan17] 02/9/2019 16:21

Buffett invested in Apple, Wells Fargo, Goldman Sachs, IBM; not sure if those could be run by idiots.

In addition, how complicated are banking financial statements with all their complex derivatives but yet Buffett still invested.

Can see him wanting to take a look at Burford.

[williamcooper104] 02/9/2019 16:14

Or as he put it - invest in companies that can be run by an idiot because one day they will be Bur cannot be run by an idiot

[williamcooper104] 02/9/2019 16:13

I think they're more alluding to the reputional risk the nomad takes But if that was the case then the nomad would resign - they wouldn't sulk about it

[williamcooper104] 02/9/2019 16:11

Alas I'm not sure there Most of their institutional investors won't be able to own unlisted shares either so imagine there will be a solution

[yidarmytom] 02/9/2019 16:09

adnan BUR fits this:-

“Risk comes from not knowing what you are doing.”
“It’s far better to buy a wonderful company at a fair price, than a fair company at a wonderful price.”

but maybe not this for many people.........

“Invest Only in Companies You Understand”

Although Buffetts last phrase is rapidly becoming appropriate as people do get to understand this Company