BKU
BankUnited, Inc.
$44.78
Banks, Insurers & Asset Managers
85%
P/Tangible Book × ROE Quality
Mild
·
Conviction
Overvalued
Trading 15.0% above fair value
You pay
$44.78
Bear
$27.26
Fair
$38.94
Bull
$50.62
Bear
$27.26
-39.1%
ROTCE 6.8% → 0.41x TBV
Fair
$38.94
-13.0%
ROTCE 9.0% → 0.75x TBV
Bull
$50.62
+13.0%
ROTCE 10.4% → 0.95x TBV
Adjust Assumptions
9.0%
10.7%
Key Value Driver
ROTCE (9.0%) vs. cost of equity (10.7%)
Implied Market Multiple
1.09x
Analyst Consensus (External Reference)
Never blended into the bear/base/bull estimates above.
Average Target (29 analysts)
$50.67
Divergence from AlphaVal
23%
Summary
With ROTCE of 9.0% vs. 10.7% cost of equity, fair P/TBV is 0.75x on $40.95 tangible book, implying $38.94 per share. DDM cross-check: $28.27.
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.
Return on equity (9.0%) is below the minimum investors require (10.7%). This means the bank is worth less than the net assets on its books.
Dividend-based valuation: $28.27 (27% 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