BHF
Brighthouse Financial, Inc.
$65.74
Banks, Insurers & Asset Managers
85%
P/Tangible Book × ROE Quality
Strong
·
Conviction
Undervalued
Trading 56.6% below fair value
You pay
$65.74
Bear
$106.11
Fair
$151.59
Bull
$197.06
Bear
$106.11
+61.4%
ROTCE 14.8% → 2.12x TBV
Fair
$151.59
+130.6%
ROTCE 19.7% → 3.09x TBV
Bull
$197.06
+199.8%
ROTCE 22.6% → 3.67x TBV
Key Value Driver
ROTCE (19.7%) vs. cost of equity (9.1%)
Implied Market Multiple
1.72x
Summary
Our base-case estimate uses P/Tangible Book × ROE Quality. We then blend that result with the average analyst price target of $57.44 from 20 analysts, using a 25% weight on analyst consensus. That produces an estimated intrinsic value of $151.59 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 219% 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