The market has so far assigned low odds of this litigation company collecting on a $16 billion judgment, but as we’ll explain today, the odds are stacking up in the company’s favor toward forcing a settlement agreement. The punchline: we believe the company could be on the cusp of a multi-billion-dollar windfall that could send its shares higher by 100% or more.
Burford Capital is the world’s largest provider of litigation finance – offering the capital and legal expertise that enable its clients to pursue litigation they might not otherwise be able to pursue. In this report, we explain why a recent legal victory could unleash a windfall of $3 billion, equal to the entire market capitalization of the company.
The company we report on today has achieved an incredible 105% average return on invested capital (ROIC) since inception. Even more impressive, the company has had only one losing year over this period – in 2011, when it generated a modest loss of -2% ROIC. It might be one of the most asymmetrical opportunities we have seen in years.