BANF
BancFirst Corporation
$111.31
Banks, Insurers & Asset Managers
85%
P/Tangible Book × ROE Quality
Moderate
·
Conviction
Fair Value
Trading 21.9% below fair value
You pay
$111.31
Bear
$93.38
Fair
$142.45
Bull
$171.90
Bear
$93.38
-16.1%
ROTCE 10.9% → 1.90x TBV
Fair
$142.45
+28.0%
ROTCE 14.6% → 2.90x TBV
Bull
$171.90
+54.4%
ROTCE 16.8% → 3.50x TBV
Key Value Driver
ROTCE (14.6%) vs. cost of equity (7.6%)
Implied Market Multiple
2.27x
Summary
With ROTCE of 14.6% vs. 7.6% cost of equity, fair P/TBV is 2.90x on $49.13 tangible book, implying $142.45 per share. DDM cross-check: $155.47.
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