AMSF
AMERISAFE, Inc.
$25.06
Banks, Insurers & Asset Managers
85%
P/Tangible Book × ROE Quality
Strong
·
Conviction
Undervalued
Trading 58.7% below fair value
You pay
$25.06
Bear
$49.74
Fair
$60.70
Bull
$78.90
Bear
$49.74
+98.5%
ROTCE 15.3% → 4.00x TBV
Fair
$60.70
+142.2%
ROTCE 20.5% → 4.00x TBV
Bull
$78.90
+214.9%
ROTCE 23.5% → 4.00x TBV
Adjust Assumptions
20.5%
6.0%
Key Value Driver
ROTCE (20.5%) vs. cost of equity (6.0%)
Implied Market Multiple
2.02x
Analyst Consensus (External Reference)
Never blended into the bear/base/bull estimates above.
Average Target (6 analysts)
$33.50
Divergence from AlphaVal
81%
Summary
With ROTCE of 20.5% vs. 6.0% cost of equity, fair P/TBV is 4.00x on $12.44 tangible book, implying $60.70 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.
Wall Street's average price target is $33.50 (from 6 analysts). Our estimate is 81% above the consensus -- consider that gap carefully.
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