BPOP
Popular, Inc.
$162.73
Banks, Insurers & Asset Managers
85%
P/Tangible Book × ROE Quality
Moderate
·
Conviction
Undervalued
Trading 29.0% below fair value
You pay
$162.73
Bear
$152.99
Fair
$229.24
Bull
$274.99
Bear
$152.99
-6.0%
ROTCE 12.1% → 2.10x TBV
Fair
$229.24
+40.9%
ROTCE 16.1% → 3.15x TBV
Bull
$274.99
+69.0%
ROTCE 18.5% → 3.78x TBV
Key Value Driver
ROTCE (16.1%) vs. cost of equity (7.8%)
Implied Market Multiple
2.03x
Summary
Our base-case estimate uses P/Tangible Book × ROE Quality. We then blend that result with the average analyst price target of $159.33 from 20 analysts, using a 25% weight on analyst consensus. That produces an estimated intrinsic value of $229.24 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 $159.33 (from 20 analysts). Our estimate is 59% 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