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YouOnly: great response!
Yup, I do fully agree that consistency of data is definitely an area for improvement. There are a mind boggling set of numbers to work through and they do tend to change each year. There was big improvement last year (but in some ways it made it even harder to understand). Some cross-sector co-ordination would help. I guess since it's a new industry it's a case of finding those that seem most informative and sticking to them.
There's probably a tricky balance to be struck between quality of information and the quantity becoming overwhelming. I think a lot of the information you talk about is already there! It's just buried in side comments a lot of the time. You have to work to root it out which isn't ideal.
I've done huge amounts of churning on the numbers to remove certain aspects (e.g. fair value adjustments) and put things in better context. Also some work to adjust for the time lag from investment to return... that's massive given the huge step up from 2017. They could do some of that themselves without ending up with information overload.
You're point about the hidden value in the funds is a massive one for me and it's definitely not immediately apparent. There has to be a simple way of presenting that in a form that gives some indication of the contribution being made pre-waterfall.
I'm not really sure I personally agree on the fanfare element or getting involved with counteracting every single bit of press misinformation... I personally believe that the best thing for management to do is to work on the business, not on the markets perception or the government supporting Argentine press (amongst others) crusade to discredit them! I see it as ill-spent time and an unwelcome distraction from doing what they should be doing (building the core business). I simply don't think people listen anyway - look how much time they've spent emphasising how lumpy results will inevitably be and yet people still scream when EPS is "down" on a previous year!!
The only thing that matters is results... eventually the market never ignores cold hard results.
I do get the impression that BUR work very, very hard on industry publicity i.e. awareness within law firms but that it's not necessarily evident externally. Hopefully.
I'm right with you that it would be nice if the SP were a least a bit more respectable. It doesn't really matter long term, but the biggest threat currently is probably a under value buyout. The SWF has 666m invested for just 40% of the returns... current total market cap is only around three times their current investment... somebody has to be looking at that
laconic: all good points, and I agree with your sentiment about gross mis-valuation. We have to assume that at some point the market will see sense (and get their head around a 92% return on invested capital - which is frankly incredible).
I suppose I would like to see:
more frequent investor comms, more capital market days, more fanfare around the business, more press on the opportunity of funding (most of their BD is either the laudable aim of gender balance in the legal sector or broad opinion pieces on this and that), and more work done to explain what their business does and how it works. I understand it entirely - I am amazed how many investors (and even institutions) do not.
I would like more consistency in how data is presented, clarity on challenges the business faces (we all know there are court delays etc) and an ownership of when numbers are down or flat. I would also like the company to spend more time explaining how Peterson has already made them multiple hundreds of millions of dollars and isn't a contributor at present, If it comes in, super, if it doesn't, then it's not going to chop the knees off the company. With the stuff you read, you'd guess that an unfavourable result on 'the big one' is the end of days - which only ignores the hundreds of other investments (at 92% ROIC) and the other lines of income, including extremely profitable funding management fees!
I am heavily invested here and whilst frustrated at the lack of movement and still significantly down from the Muddy Waters short, have total faith that the ship will turn. However, the car needs a bump start, and I think a fresh narrative and some new energy is needed to the investment case and the broader corporate comms.
Lost a few k on this one, sold after the results pullback. Made my losses back elsewhere & and bought back into BUR back end of last week.
Down again!
No excitement around this company/share, that’s why the shorts find it easy
YouOnly: You've said you want management to say something but my question when these kind of statements arise is what *exactly* do you want management to say?
What information specifically do you expect them to provide that they don't already? The can't magic progress in cases out of nowhere.
What "leaf from some other's books" do you want them to take specifically?
I'm as frustrated as anyone by the lack of momentum in the share price... probably more so given how large my holding is.
However, this isn't selling cans of baked beans. They can only report the information they have and can't magic new information that the market will love out of thin air. The court system ground to a virtual halt last year. They can't report what simply isn't happening. That aside, the reasons why they do limited reporting are also well explained throughout time.
I agree that information presentation can improve (in annual/interim reports) massively and could be far more digestable without huge amounts of effort. There was a big step forward in that respect in the 2020 annual report and I'm personally hoping for further steps this year.
However, I'm also realistic in what I believe management can do to change (what I strongly believe) is the current gross mis-valuation by the market. Generally, announcements in recent times have just produced very short lived spikes good to nobody expect short term traders.
One element I personally believe is that Peterson is scaring off institutional investors whom are well documented as caring more about their jobs than getting maximum returns for their investors. Peterson is in the home stretch and not far off resolving one way or another. Until it does I don't personally think there's much management could say to change the current overall market caution.
Even believers in BUR like TimeWillTell believe the price will fall after results and sell out hoping to buy back in. MMs know this and play on it. Look at the short movements around results. In many ways, investors control the share price more than management.
In summary, what do you actually want them to say (that isn't repeating what they have already said, is actually without the power of any company's management to say and actually has meaningful substance)?
Meh...
It is depressing I agree. I'm a slightly reluctant holder but think the positives just about outweigh the negatives so continue to hold - i have the usual feeling that the price will take off the moment i sell with some good news on petersen or something.
Well this is all fairly depressing. Total faith that the market is severely mis-valuing this one, but HOW frustrating is the lack of investor comms from Burford? I do wish they'd take a leaf from some other's books and get some proper market work up and running. I fully appreciate Chris Bogart's "we don't care about the share price, the business speaks for itself" mantra, but there comes a point where leaving the SP to rot in the corner just damages the brand, the company, the image and of course the finances. Plus, you now have large swathes of the retail market that refuse to touch Burford ever again!
It's all silly when you look at the numbers and a good excuse to buy more. But HOW LONG must this go on? People will waste their questions on the upcoming investor call asking about case pipeline, whether diligence is still strong etc - all those things are fine. The business is flying. The real question is "when are you going to give retail investors the support and consistently-presented information that they need"?