BWB
Bridgewater Bancshares, Inc.
$21.89
Banks, Insurers & Asset Managers
85%
P/Tangible Book × ROE Quality
Mild
·
Conviction
Fair Value
Trading 13.8% below fair value
You pay
$21.89
Bear
$14.21
Fair
$25.39
Bull
$32.10
Bear
$14.21
-35.1%
ROTCE 6.9% → 0.80x TBV
Fair
$25.39
+16.0%
ROTCE 9.3% → 1.42x TBV
Bull
$32.10
+46.7%
ROTCE 10.6% → 1.80x TBV
Key Value Driver
ROTCE (9.3%) vs. cost of equity (7.7%)
Implied Market Multiple
1.23x
Summary
With ROTCE of 9.3% vs. 7.7% cost of equity, fair P/TBV is 1.42x on $17.87 tangible book, implying $25.39 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.
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