BUR - Burford Capital Limited
Price:
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CONSENSUS:
Buy
DETAILS
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PRICE TARGET:
$5.00
DETAILS
HIGH:
$5.00
LOW:
$5.00
MEDIAN:
$5.00
CONSENSUS:
$5.00
UPSIDE:
22.55%
AlphaVal
Deterministic, archetype-aware fair value
Banks, Insurers & Asset Managers
85% confidence
Primary model: P/Tangible Book × ROE Quality
Adjust Assumptions
2.7%
10.2%
Key Value Driver
ROTCE (2.7%) vs. cost of equity (10.2%)
Implied Market Multiple
0.39x
Plain-Language Summary
With ROTCE of 2.7% vs. 10.2% cost of equity, fair P/TBV is 0.30x on $10.56 tangible book, implying $16.28 per share. DDM cross-check: $11.17.
Warnings
Traditional cash flow models don't work well for banks — lending activity distorts how much cash the business actually generates.
Common valuation shortcuts don't apply here — for banks, interest payments are a core business cost, not overhead.
Return on equity (2.7%) is below the minimum investors require (10.2%). This means the bank is worth less than the net assets on its books.
Dividend-based valuation: $11.17 (31% below our primary estimate). Large gaps suggest the dividend may not fully reflect the company's value.
Key Risks
- Book value quality matters as much as level — check loan loss reserves
- Interest rate sensitivity creates non-linear earnings surprises
- Insurance reserving is actuarial, not financial — errors emerge slowly