BY
Byline Bancorp, Inc.
$33.17
Banks, Insurers & Asset Managers
85%
P/Tangible Book × ROE Quality
Moderate
·
Conviction
Fair Value
Trading 22.8% below fair value
You pay
$33.17
Bear
$26.97
Fair
$42.95
Bull
$52.55
Bear
$26.97
-18.7%
ROTCE 9.1% → 1.17x TBV
Fair
$42.95
+29.5%
ROTCE 12.2% → 1.86x TBV
Bull
$52.55
+58.4%
ROTCE 14.0% → 2.27x TBV
Key Value Driver
ROTCE (12.2%) vs. cost of equity (8.4%)
Implied Market Multiple
1.41x
Summary
Our base-case estimate uses P/Tangible Book × ROE Quality. We then blend that result with the average analyst price target of $40.00 from 11 analysts, using a 20% weight on analyst consensus. That produces an estimated intrinsic value of $42.95 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.
Dividend-based valuation: $10.63 (76% below our primary estimate). Large gaps suggest the dividend may not fully reflect the company's value.
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