BNPQY
BNP Paribas S.A.
$58.92
Banks, Insurers & Asset Managers
90%
P/Tangible Book × ROE Quality
Moderate
·
Conviction
Fair Value
Trading 19.5% below fair value
You pay
$58.92
Bear
$51.25
Fair
$73.22
Bull
$95.18
Bear
$51.25
-13.0%
ROTCE 7.7% → 0.62x TBV
Fair
$73.22
+24.3%
ROTCE 10.3% → 1.05x TBV
Bull
$95.18
+61.5%
ROTCE 11.9% → 1.31x TBV
Key Value Driver
ROTCE (10.3%) vs. cost of equity (10.0%)
Implied Market Multiple
1.0x
Summary
With ROTCE of 10.3% vs. 10.0% cost of equity, fair P/TBV is 1.05x on $58.85 tangible book, implying $73.22 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.
Financial statements were converted from EUR into USD using EURUSD at 1.1378 USD per EUR.
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