Last Updated: 13 Nov 2024
Executive Summary
Burford Capital Ltd (BUR) is a leading provider of investment capital, asset management, financing, and risk solutions for the legal sector. The company has a strong track record of growth and profitability, and is well-positioned to continue to benefit from the growing demand for legal finance.
The latest stock price for BUR is $13.34, which is below the analyst target price of $19.70. The stock is trading at a discount to its peers, and has a number of positive fundamental and technical indicators.
Company Overview
Burford Capital was founded in 2009 and is headquartered in Guernsey. The company provides a range of services to the legal sector, including:
Litigation finance: Burford provides funding to law firms and their clients to help them pursue legal claims.
Asset management: Burford manages a portfolio of legal assets, including litigation finance investments and other legal-related investments.
Financing: Burford provides financing to law firms and their clients to help them manage the costs of litigation.
Risk solutions: Burford provides risk management solutions to law firms and their clients to help them mitigate the risks associated with litigation.
Burford Capital has a global presence, with offices in London, New York, Chicago, Los Angeles, Sydney, and Singapore. The company has a team of experienced professionals with a deep understanding of the legal sector.
Fundamental Analysis
Burford Capital has a strong track record of growth and profitability. The company's revenue has grown from $128.4 million in 2019 to $310.9 million in 2023. The company's net income has grown from $21.9 million in 2019 to $62.8 million in 2023.
Burford Capital is profitable on both a GAAP and non-GAAP basis. The company's GAAP net income margin was 20.2% in 2023, and its non-GAAP net income margin was 31.4%.
Burford Capital has a strong balance sheet. The company has $1.99 billion in cash and equivalents, and no debt. The company's debt-to-equity ratio is 0.00.
Burford Capital is trading at a discount to its peers. The company's trailing P/E ratio is 8.08, compared to the industry average of 10.05. The company's forward P/E ratio is 9.68, compared to the industry average of 11.22.
Technical Analysis
Burford Capital's stock price has been in a downtrend since early 2023. The stock price has fallen from a high of $16.62 in January 2023 to a low of $12.01 in June 2023.
The stock price is currently trading below its 50-day and 200-day moving averages. The stock price is also trading below the lower Bollinger Band.
The technical indicators suggest that the stock price is oversold and could be due for a rebound. The stock price is also approaching a support level at $13.00.
Short Term Outlook
The short-term outlook for Burford Capital is mixed. The stock price is trading below its moving averages and is oversold. However, the stock price is also approaching a support level.
If the stock price can break above its 50-day moving average, it could rally to the $14.00 level. If the stock price falls below its support level, it could fall to the $12.00 level.
Long Term Outlook
The long-term outlook for Burford Capital is positive. The company has a strong track record of growth and profitability, and is well-positioned to continue to benefit from the growing demand for legal finance.
The company's strong balance sheet and experienced management team give it a competitive advantage in the legal finance market. Burford Capital is a good long-term investment for investors who are looking for a company with a solid track record of growth and profitability.
Analyst Recommendations
The majority of analysts who cover Burford Capital have a buy or strong buy rating on the stock. The average analyst target price for the stock is $19.70, which is 47.6% above the current stock price.
Disclaimer
This report is for informational purposes only and should not be considered investment advice. Please consult with a financial advisor before making any investment decisions.
