BTBT
Bit Digital, Inc.
$1.39
Banks, Insurers & Asset Managers
85%
P/Tangible Book × ROE Quality
Strong
·
Conviction
Overvalued
Trading 134.1% above fair value
Bear
$0.59
-57.3%
ROTCE 4.0% → 0.30x TBV
Fair
$0.59
-57.3%
ROTCE -11.6% → 0.30x TBV
Bull
$0.59
-57.3%
ROTCE -13.4% → 0.30x TBV
Adjust Assumptions
-11.6%
14.0%
Key Value Driver
ROTCE (-11.6%) vs. cost of equity (14.0%)
Implied Market Multiple
0.7x
Summary
With ROTCE of -11.6% vs. 14.0% cost of equity, fair P/TBV is 0.30x on $1.98 tangible book, implying $0.59 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.
Return on equity (-11.6%) is below the minimum investors require (14.0%). This means the bank is worth less than the net assets on its books.
This stock is 69% 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