BANR
Banner Corporation
$64.65
Banks, Insurers & Asset Managers
85%
P/Tangible Book × ROE Quality
Moderate
·
Conviction
Fair Value
Trading 20.8% below fair value
You pay
$64.65
Bear
$57.18
Fair
$81.68
Bull
$106.18
Bear
$57.18
-11.6%
ROTCE 9.3% → 1.07x TBV
Fair
$81.68
+26.3%
ROTCE 12.4% → 1.70x TBV
Bull
$106.18
+64.2%
ROTCE 14.3% → 2.07x TBV
Key Value Driver
ROTCE (12.4%) vs. cost of equity (9.0%)
Implied Market Multiple
1.4x
Summary
Our base-case estimate uses P/Tangible Book × ROE Quality. We then blend that result with the average analyst price target of $70.00 from 13 analysts, using a 20% weight on analyst consensus. That produces an estimated intrinsic value of $81.68 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: $36.47 (57% 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