Hi Jimmy, Its worth having a look at LCA based on the investment...

Hi Jimmy,

Its worth having a look at LCA based on the investment thesis that you outlined above.  
While the company was up until recently underfunded this has recently changed.  Two recent case wins have provided $18.5m in cash (on a MOIC of 3x) plus a share in a 3^rd case win that isn’t quantified yet (as it was co-funded externally). Further to the current capital position they have two further cases due for resolution in FY18.  Together this will provide the company with a healthy balance sheet to deploy into cases going forward.

When I reconstruct the balance sheet post the announced wins I calculate that you can still buy the stock today at roughly 1x book value (assuming mark to market on the litigation assets at 2x which is what I do for self funding models) and for a company that has the ability earn sustainable ROE of 20%+ this is extraordinarily cheap in what I find is an otherwise expensive market.  And while I don’t generally assign price targets - any company that can sustainably generate ROE in excess of 20%+ is trading on at least 3x book value (usually closer to 5x) which would imply a market capitalization of around $100m (at 3x book) which equates to a share price of around $1.95.