ACNB
ACNB Corporation
$63.59
Banks, Insurers & Asset Managers
85%
P/Tangible Book × ROE Quality
Mild
·
Conviction
Overvalued
Trading 14.3% above fair value
You pay
$63.59
Bear
$38.95
Fair
$55.65
Bull
$72.34
Bear
$38.95
-38.7%
ROTCE 8.3% → 0.86x TBV
Fair
$55.65
-12.5%
ROTCE 11.1% → 1.41x TBV
Bull
$72.34
+13.8%
ROTCE 12.8% → 1.73x TBV
Adjust Assumptions
11.1%
9.1%
Key Value Driver
ROTCE (11.1%) vs. cost of equity (9.1%)
Implied Market Multiple
1.94x
Summary
With ROTCE of 11.1% vs. 9.1% cost of equity, fair P/TBV is 1.41x on $32.75 tangible book, implying $55.65 per share.
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.
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