ASB
Associated Banc-Corp
$31.07
Banks, Insurers & Asset Managers
85%
P/Tangible Book × ROE Quality
Moderate
·
Conviction
Fair Value
Trading 17.4% below fair value
You pay
$31.07
Bear
$23.71
Fair
$37.63
Bull
$45.98
Bear
$23.71
-23.7%
ROTCE 9.3% → 1.16x TBV
Fair
$37.63
+21.1%
ROTCE 12.3% → 1.85x TBV
Bull
$45.98
+48.0%
ROTCE 14.2% → 2.26x TBV
Adjust Assumptions
12.3%
8.5%
Key Value Driver
ROTCE (12.3%) vs. cost of equity (8.5%)
Implied Market Multiple
1.52x
Analyst Consensus (External Reference)
Never blended into the bear/base/bull estimates above.
Average Target (20 analysts)
$32.50
Divergence from AlphaVal
16%
Summary
With ROTCE of 12.3% vs. 8.5% cost of equity, fair P/TBV is 1.85x on $20.39 tangible book, implying $37.63 per share. DDM cross-check: $20.72.
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: $20.72 (45% below our primary estimate). Large gaps suggest the dividend may not fully reflect the company's value.
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