AX
Axos Financial, Inc.
$88.14
Banks, Insurers & Asset Managers
85%
P/Tangible Book × ROE Quality
Moderate
·
Conviction
Undervalued
Trading 30.2% below fair value
You pay
$88.14
Bear
$88.42
Fair
$126.31
Bull
$164.20
Bear
$88.42
+0.3%
ROTCE 12.7% → 1.18x TBV
Fair
$126.31
+43.3%
ROTCE 17.0% → 1.75x TBV
Bull
$164.20
+86.3%
ROTCE 19.5% → 2.10x TBV
Adjust Assumptions
17.0%
11.4%
Key Value Driver
ROTCE (17.0%) vs. cost of equity (11.4%)
Implied Market Multiple
1.73x
Analyst Consensus (External Reference)
Never blended into the bear/base/bull estimates above.
Average Target (20 analysts)
$124.50
Divergence from AlphaVal
1%
Summary
With ROTCE of 17.0% vs. 11.4% cost of equity, fair P/TBV is 1.75x on $50.85 tangible book, implying $126.31 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