BHF
Brighthouse Financial, Inc.
$52.88
Banks, Insurers & Asset Managers
85%
P/Tangible Book × ROE Quality
Strong
·
Conviction
Undervalued
Trading 55.6% below fair value
You pay
$52.88
Bear
$81.74
Fair
$119.12
Bull
$141.55
Bear
$81.74
+54.6%
ROTCE 14.8% → 2.13x TBV
Fair
$119.12
+125.3%
ROTCE 19.7% → 3.11x TBV
Bull
$141.55
+167.7%
ROTCE 22.6% → 3.69x TBV
Adjust Assumptions
19.7%
9.0%
Key Value Driver
ROTCE (19.7%) vs. cost of equity (9.0%)
Implied Market Multiple
1.38x
Analyst Consensus (External Reference)
Never blended into the bear/base/bull estimates above.
Average Target (20 analysts)
$57.44
Divergence from AlphaVal
107%
Summary
With ROTCE of 19.7% vs. 9.0% cost of equity, fair P/TBV is 3.11x on $38.31 tangible book, implying $119.12 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.
Wall Street's average price target is $57.44 (from 20 analysts). Our estimate is 107% above the consensus -- consider that gap carefully.
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