ASB
Associated Banc-Corp
$28.01
Banks, Insurers & Asset Managers
85%
P/Tangible Book × ROE Quality
Moderate
·
Conviction
Undervalued
Trading 27.4% below fair value
You pay
$28.01
Bear
$24.31
Fair
$38.58
Bull
$47.14
Bear
$24.31
-13.2%
ROTCE 9.3% → 1.13x TBV
Fair
$38.58
+37.7%
ROTCE 12.3% → 1.79x TBV
Bull
$47.14
+68.3%
ROTCE 14.2% → 2.19x TBV
Key Value Driver
ROTCE (12.3%) vs. cost of equity (8.7%)
Implied Market Multiple
1.21x
Summary
Our base-case estimate uses P/Tangible Book × ROE Quality. We then blend that result with the average analyst price target of $29.71 from 20 analysts, using a 25% weight on analyst consensus. That produces an estimated intrinsic value of $38.58 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.
Dividend-based valuation: $19.06 (54% below our primary estimate). Large gaps suggest the dividend may not fully reflect the company's value.
Wall Street's average price target is $29.71 (from 20 analysts). Our estimate is 40% 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