BANR
Banner Corporation
$66.43
Banks, Insurers & Asset Managers
85%
P/Tangible Book × ROE Quality
Moderate
·
Conviction
Fair Value
Trading 21.5% below fair value
You pay
$66.43
Bear
$59.22
Fair
$84.60
Bull
$109.98
Bear
$59.22
-10.9%
ROTCE 9.3% → 1.10x TBV
Fair
$84.60
+27.4%
ROTCE 12.4% → 1.74x TBV
Bull
$109.98
+65.6%
ROTCE 14.3% → 2.13x TBV
Adjust Assumptions
12.4%
8.8%
Key Value Driver
ROTCE (12.4%) vs. cost of equity (8.8%)
Implied Market Multiple
1.44x
Analyst Consensus (External Reference)
Never blended into the bear/base/bull estimates above.
Average Target (13 analysts)
$73.50
Divergence from AlphaVal
15%
Summary
With ROTCE of 12.4% vs. 8.8% cost of equity, fair P/TBV is 1.74x on $46.25 tangible book, implying $84.60 per share. DDM cross-check: $38.47.
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.
Dividend-based valuation: $38.47 (55% 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