APAM
Artisan Partners Asset Management Inc.
$32.96
Banks, Insurers & Asset Managers
85%
P/Tangible Book × ROE Quality
Strong
·
Conviction
Undervalued
Trading 65.4% below fair value
You pay
$32.96
Bear
$66.61
Fair
$95.16
Bull
$123.71
Bear
$66.61
+102.1%
ROTCE 20.0% → 1.66x TBV
Fair
$95.16
+188.7%
ROTCE 25.0% → 2.18x TBV
Bull
$123.71
+275.3%
ROTCE 30.0% → 2.70x TBV
Adjust Assumptions
66.2%
13.6%
Key Value Driver
ROTCE (66.2%) vs. cost of equity (13.6%)
Implied Market Multiple
5.33x
Analyst Consensus (External Reference)
Never blended into the bear/base/bull estimates above.
Average Target (15 analysts)
$36.33
Divergence from AlphaVal
162%
Summary
With ROTCE of 66.2% vs. 13.6% cost of equity, fair P/TBV is 2.18x on $6.18 tangible book, implying $95.16 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 $36.33 (from 15 analysts). Our estimate is 162% 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