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Manolete (MANO) reported good half year results last week. Although much smaller and more of a specialist in insolvency situations, they are litigation funders like BUR. MANO shares have nearly tripled since flotation and I reckon they are on a forward P/E ratio of say 25. That compares with BUR on less than 7. How do you make sense of that? Yes Petersen flatters BUR earnings, but even so BUR is worth a P/E of maybe 15? I agree with those who attribute the situation to an extreme loss of investor confidence since the short selling attack. We can only stay with it and hope BUR comes up with a solid set of results in March 2020. It is too much to hope that the useless regulators will put the cuffs on the likes of MW this side of 2021, if ever. As for Berenberg, they knew about Petersen and the lumpy earnings of litigation funding when they made their “buy” recommendations, so all they are doing now is following the market down. Pathetic, it makes you realise that broker recommendations are mostly worthless.
Playing devils advocate, I don't think the stuff about MW or shorters etc will do any good in being pursued. It becomes like a Trump you said...I said, and lead to poor publicity and no winners all round.
It's like Corbyn is going to bring all the rich people to account etc.
They will do much better to produce results from cases. Petersen is the crown jewel, but they have had plenty of others and stuffed back this and more £ into further cases.
The issue is it is unlike a widget company where it costs 10p to make and then sell it for 15p - here the money in vs outcome £ out is unpredictable in time and value. Like any company to grow they need to put the money in - but must now start to show it can come out - and that seems to be where people / institutions have wavered from probably over optimistic to perhaps too sceptical. That's the nature of this share.
I do though agree with whatabout that the new year needs action on new independent Directors & NY listing progress to reinforce a more optimistic progression on top of positive results.
The last few months have been a bit of a mystery in terms of what is actually going on behind the scenes despite strong rebuttals from the BOD. I fully agree that The Times continually write negative stuff about BUR which is poor and lazy journalism. One of the challenges for the company is that the market continues to wait for some form of retribution against MW and any others who have allegedly tried to manipulate the price for financial gain. We can only assume that the legal process continues to chug along with no certainty as to the final outcome. If the courts decide that there is no case to answer IMO this will put pressure on the shares. On the other hand if the courts decide that the shares have been manipulated and action is taken against individuals, that kind of positive news could release us from the current £8-£9 range. Frustrating like so many shares on AIM these days.
If the BOD were to issue RNS giving an update on progress of their quest in seeking judicial approval to obtain data from the London Stock Exchange that may steady the ship and quell some of the volatility around this share?
Never read anything positive in the Times re Burford and this is no different. MW position is restated but no mention of any rebuttal from Burford nor the suspicion of market manipulation by others
Burford on the other hand have seemingly done little in the last 3 months with no new independent directors appointed and nothing in respect of the listing that is supposed to happen Q1 20. Be interesting to see where this is in March next year alongside full year results
Waters are muddied even further at Burford Capital
Since Muddy Waters conducted a devastating bear raid on Burford Capital in the summer, shares in the litigation financing company remain down by about half. The American short-seller alleged that Burford, at the time the most valuable company on Aim, London’s junior market, was “egregiously misrepresenting” its return on investments, was “arguably insolvent” and of “laughter-inducing” governance.
In something of an understatement yesterday, analysts at Berenberg said that Burford, which has strongly rejected the allegations, had suffered a “tough six months”. However, “now the dust has settled”, the investment bank said it had analysed some of the concerns raised by Muddy Waters. The result? A downgrade of Burford to “hold”.
Berenberg said: “We conclude that while the accounting is likely correct, Burford’s returns are heavily concentrated in a low number of investments and a large proportion of Burford’s value is driven by the Petersen case, which so far has been one spectacularly successful investment.” The case involves the Petersen Group, of Spain, which went into administration amid the fallout surrounding the expropriation of YPF, the oil company, by Argentina. Burford’s shares promptly fell 44½p, or 5.2 per cent, to 813p.
There's an article in the times online today 're Burford. Be grateful for thoughts.