Burford Capital Stock Beneish M Score

BUR Stock  USD 13.35  0.02  0.15%   
This module uses fundamental data of Burford Capital to approximate the value of its Beneish M Score. Burford Capital M Score tells investors if the company management is likely to be manipulating earnings. The score is calculated using eight financial indicators that are adjusted by a specific multiplier. Please note, the M Score is a probabilistic model and cannot detect companies that manipulate their earnings with 100% accuracy. Check out Burford Capital Piotroski F Score and Burford Capital Altman Z Score analysis.
To learn how to invest in Burford Stock, please use our How to Invest in Burford Capital guide.
  
At this time, Burford Capital's Net Debt is relatively stable compared to the past year. As of 12/05/2024, Net Debt To EBITDA is likely to grow to 1.69, while Long Term Debt is likely to drop slightly above 609.3 M. At this time, Burford Capital's Net Income Per Share is relatively stable compared to the past year. As of 12/05/2024, Sales General And Administrative To Revenue is likely to grow to 0.03, while PTB Ratio is likely to drop 1.02.
At this time, it appears that Burford Capital is a possible manipulator. The earnings manipulation may begin if Burford Capital's top management creates an artificial sense of financial success, forcing the stock price to be traded at a high price-earnings multiple than it should be. In general, excessive earnings management by Burford Capital executives may lead to removing some of the operating profits from subsequent periods to inflate earnings in the following periods. This way, the manipulation of Burford Capital's earnings can lead to misrepresentations of actual financial condition, taking the otherwise loyal stakeholders on to the path of questionable ethical practices and plain fraud.
-1.65
Beneish M Score - Possible Manipulator
Elasticity of Receivables

1.0

Focus
Asset Quality

1.0

Focus
Expense Coverage

0.59

Focus
Gross Margin Strengs

0.8

Focus
Accruals Factor

0.59

Focus
Depreciation Resistance

0.77

Focus
Net Sales Growth

1.05

Focus
Financial Leverage Condition

1.0

Focus

Burford Capital Beneish M-Score Indicator Trends

The cure to earnings manipulation is the transparency of financial reporting. It will typically remove the temptation of the top executives to inflate earnings (i.e., to promote the idea of 'winning at any cost'). Because a healthy internal audit department can enhance transparency, the board should promote the auditors' access to all the record-keeping systems across the enterprise. For example, if Burford Capital's auditors report directly to the board (not management), the managers will be reluctant to manipulate simply due to the fear of punishment. On the other hand, the auditors will be free to investigate the ledgers properly because they know that the board has their back.
Current ValueLast YearChange From Last Year 10 Year Trend
Net Receivables273.4 M260.4 M
Sufficiently Up
Slightly volatile
Total Assets6.1 B5.8 B
Sufficiently Up
Slightly volatile
Total Current Assets650.1 M619.2 M
Sufficiently Up
Slightly volatile
Non Current Assets Total10.9 B10.4 B
Sufficiently Up
Slightly volatile
Property Plant Equipment8.6 M15 M
Way Down
Slightly volatile
Selling General Administrative21 M33.7 M
Way Down
Slightly volatile
Total Current Liabilities299.1 M284.8 M
Sufficiently Up
Slightly volatile
Non Current Liabilities Total2.7 B2.5 B
Sufficiently Up
Slightly volatile
Short Term Debt2.4 M2.5 M
Notably Down
Slightly volatile
Long Term Debt609.3 M1.2 B
Way Down
Slightly volatile
Short Term Investments76 M107.6 M
Way Down
Pretty Stable
Long Term Investments2.7 B5.2 B
Way Down
Slightly volatile
Gross Profit Margin0.790.9847
Significantly Down
Slightly volatile

Burford Capital Beneish M-Score Driver Matrix

One of the toughest challenges investors face today is learning how to quickly synthesize historical financial statements and information provided by the company, SEC reporting, and various external parties in order to detect the potential manipulation of earnings. Understanding the correlation between Burford Capital's different financial indicators related to revenue, expenses, operating profit, and net earnings helps investors identify and prioritize their investing strategies towards Burford Capital in a much-optimized way. Analyzing correlations between earnings drivers directly associated with dollar figures is the most effective way to find Burford Capital's degree of accounting gimmicks and manipulations.

About Burford Capital Beneish M Score

M-Score is one of many grading techniques for value stocks. It was developed by Professor M. Daniel Beneish of the Kelley School of Business at Indiana University and published in 1999 under the paper titled The Detection of Earnings Manipulation. The Beneish score is a multi-factor model that utilizes financial identifiers to compile eight variables used to classify whether a company has manipulated its reported earnings. The variables are built from the officially filed financial statements to create a final score call 'M Score.' The score helps to identify companies that are likely to manipulate their profits if they show deteriorating gross margins, operating expenses, and leverage against growing revenue.

Other Operating Expenses

276.39 Million

At this time, Burford Capital's Other Operating Expenses is relatively stable compared to the past year.

Burford Capital Earnings Manipulation Drivers

Although earnings manipulation is typically not the result of intentional misconduct by the c-level executives, it is still a widespread practice by the senior management of public companies such as Burford Capital. It is usually done by a series of misrepresentations of various accounting rules and operating activities across multiple financial cycles. The best way to spot the manipulation is to examine the historical financial statement to find inconsistencies in earning reports to find trends in assets or liabilities that are not sustainable in the future.
201920202021202220232024 (projected)
Net Receivables157.4M27.0M82.6M112.8M260.4M273.4M
Total Revenue327.6M316.7M(12.8M)158.1M1.1B1.1B
Total Assets2.7B2.7B3.5B4.3B5.8B6.1B
Total Current Assets344.0M364.1M286.7M245.5M619.2M650.1M
Net Debt488.6M359.1M854.2M1.2B1.3B1.4B
Long Term Debt638.7M655.9M667.8M1.0B1.2B609.3M
Operating Income225.5M208.6M(75.1M)186.4M815.7M856.4M
Investments(3.4M)(360K)(285K)(407K)(3.2M)(3.4M)

Burford Capital ESG Sustainability

Some studies have found that companies with high sustainability scores are getting higher valuations than competitors with lower social-engagement activities. While most ESG disclosures are voluntary and do not directly affect the long term financial condition, Burford Capital's sustainability indicators can be used to identify proper investment strategies using environmental, social, and governance scores that are crucial to Burford Capital's managers, analysts, and investors.
Environmental
Governance
Social

About Burford Capital Fundamental Analysis

The Macroaxis Fundamental Analysis modules help investors analyze Burford Capital's financials across various querterly and yearly statements, indicators and fundamental ratios. We help investors to determine the real value of Burford Capital using virtually all public information available. We use both quantitative as well as qualitative analysis to arrive at the intrinsic value of Burford Capital based on its fundamental data. In general, a quantitative approach, as applied to this company, focuses on analyzing financial statements comparatively, whereas a qaualitative method uses data that is important to a company's growth but cannot be measured and presented in a numerical way.
Please read more on our fundamental analysis page.

Pair Trading with Burford Capital

One of the main advantages of trading using pair correlations is that every trade hedges away some risk. Because there are two separate transactions required, even if Burford Capital position performs unexpectedly, the other equity can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Burford Capital will appreciate offsetting losses from the drop in the long position's value.

Moving together with Burford Stock

  0.82AB AllianceBernsteinPairCorr
  0.68AC Associated CapitalPairCorr

Moving against Burford Stock

  0.41RC Ready Capital CorpPairCorr
  0.31PT Pintec TechnologyPairCorr
The ability to find closely correlated positions to Burford Capital could be a great tool in your tax-loss harvesting strategies, allowing investors a quick way to find a similar-enough asset to replace Burford Capital when you sell it. If you don't do this, your portfolio allocation will be skewed against your target asset allocation. So, investors can't just sell and buy back Burford Capital - that would be a violation of the tax code under the "wash sale" rule, and this is why you need to find a similar enough asset and use the proceeds from selling Burford Capital to buy it.
The correlation of Burford Capital is a statistical measure of how it moves in relation to other instruments. This measure is expressed in what is known as the correlation coefficient, which ranges between -1 and +1. A perfect positive correlation (i.e., a correlation coefficient of +1) implies that as Burford Capital moves, either up or down, the other security will move in the same direction. Alternatively, perfect negative correlation means that if Burford Capital moves in either direction, the perfectly negatively correlated security will move in the opposite direction. If the correlation is 0, the equities are not correlated; they are entirely random. A correlation greater than 0.8 is generally described as strong, whereas a correlation less than 0.5 is generally considered weak.
Correlation analysis and pair trading evaluation for Burford Capital can also be used as hedging techniques within a particular sector or industry or even over random equities to generate a better risk-adjusted return on your portfolios.
Pair CorrelationCorrelation Matching

Additional Tools for Burford Stock Analysis

When running Burford Capital's price analysis, check to measure Burford Capital's market volatility, profitability, liquidity, solvency, efficiency, growth potential, financial leverage, and other vital indicators. We have many different tools that can be utilized to determine how healthy Burford Capital is operating at the current time. Most of Burford Capital's value examination focuses on studying past and present price action to predict the probability of Burford Capital's future price movements. You can analyze the entity against its peers and the financial market as a whole to determine factors that move Burford Capital's price. Additionally, you may evaluate how the addition of Burford Capital to your portfolios can decrease your overall portfolio volatility.