BFC
Bank First Corporation
$148.02
Banks, Insurers & Asset Managers
85%
P/Tangible Book × ROE Quality
Mild
·
Conviction
Fair Value
Trading 9.3% below fair value
You pay
$148.02
Bear
$125.68
Fair
$163.29
Bull
$163.29
Bear
$125.68
-15.1%
ROTCE 11.8% → 3.08x TBV
Fair
$163.29
+10.3%
ROTCE 15.8% → 4.00x TBV
Bull
$163.29
+10.3%
ROTCE 18.2% → 4.00x TBV
Adjust Assumptions
15.8%
6.5%
Key Value Driver
ROTCE (15.8%) vs. cost of equity (6.5%)
Implied Market Multiple
3.63x
Summary
With ROTCE of 15.8% vs. 6.5% cost of equity, fair P/TBV is 4.00x on $40.82 tangible book, implying $163.29 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