BRR
ProCap Financial, Inc.
$4.07
Banks, Insurers & Asset Managers
85%
P/Tangible Book × ROE Quality
Strong
·
Conviction
Overvalued
Trading 192.4% above fair value
Bear
$1.39
-65.8%
ROTCE 4.0% → 0.30x TBV
Fair
$1.39
-65.8%
ROTCE -6.9% → 0.30x TBV
Bull
$1.39
-65.8%
ROTCE -7.9% → 0.30x TBV
Adjust Assumptions
-6.9%
12.7%
Key Value Driver
ROTCE (-6.9%) vs. cost of equity (12.7%)
Implied Market Multiple
0.88x
Summary
With ROTCE of -6.9% vs. 12.7% cost of equity, fair P/TBV is 0.30x on $4.64 tangible book, implying $1.39 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.
Return on equity (-6.9%) is below the minimum investors require (12.7%). This means the bank is worth less than the net assets on its books.
This stock is 61% below its 52-week high, with weak or declining earnings. That combination often signals real trouble, even though the valuation below is based on other fundamentals.
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