Comparing Burford Capital (NYSE:BUR) & MDB Capital (NASDAQ:MDBH)

MDB Capital (NASDAQ:MDBH) and Burford Capital (NYSE:BUR) are both finance companies, but which is the better business? We will contrast the two companies based on the strength of their institutional ownership, dividends, profitability, earnings, analyst recommendations, risk and valuation.

Analyst Recommendations

This is a summary of current recommendations and price targets for MDB Capital and Burford Capital, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
MDB Capital	0	0	0	0	0.00
Burford Capital	0	0	3	0	3.00

Burford Capital has a consensus target price of $19.50, suggesting a potential upside of 25.77%. Given Burford Capital’s stronger consensus rating and higher probable upside, analysts clearly believe Burford Capital is more favorable than MDB Capital.

Insider & Institutional Ownership

0.4% of MDB Capital shares are held by institutional investors. 55.5% of MDB Capital shares are held by company insiders. Comparatively, 0.2% of Burford Capital shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Valuation and Earnings

This table compares MDB Capital and Burford Capital”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
MDB Capital	$5.99 million	11.23	-$6.97 million	($2.87)	-2.52
Burford Capital	$1.09 billion	3.12	$610.52 million	$1.16	13.37

Burford Capital has higher revenue and earnings than MDB Capital. MDB Capital is trading at a lower price-to-earnings ratio than Burford Capital, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares MDB Capital and Burford Capital’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
MDB Capital	N/A	-75.31%	-63.59%
Burford Capital	34.81%	8.07%	4.28%

Risk & Volatility

MDB Capital has a beta of 1.26, indicating that its share price is 26% more volatile than the S&P 500. Comparatively, Burford Capital has a beta of 0.59, indicating that its share price is 41% less volatile than the S&P 500.

Summary

Burford Capital beats MDB Capital on 10 of the 14 factors compared between the two stocks.

About MDB Capital

MDB Capital Holdings, LLC, through its subsidiaries, primarily operates as a broker-dealer. The company operates through two segments, Broker Dealer & Intellectual Property Service, and Technology Development. The Broker Dealer & Intellectual Property Service segment operates as a full-service broker dealer that focuses on conducting private and public securities offerings, as well as providing research services for investment banking due diligence. The Technology Development segment engages in the synthetic biology technology development business. The company was founded in 1997 and is based in Addison, Texas.

About Burford Capital

Burford Capital Limited provides legal finance products and services worldwide. The company operates through two segments, Capital Provision, and Asset Management and Other Provision. The Capital Provision segment provides capital to the legal industry or in connection with legal matters directly and through investment in private funds; legal risk management services; lower risk legal finance business focusing on pre-settlement litigation matters with lower risk and lower expected returns; post-settlement finance; and complex strategies in which it acts as a principal and acquires assets that are mispriced. The Asset Management and Other Services segment provides services to the legal industry, including litigation insurance. Burford Capital Limited was incorporated in 2009 and is based in Saint Peter Port, Guernsey.