CASH
Pathward Financial, Inc.
$83.19
Banks, Insurers & Asset Managers
85%
P/Tangible Book × ROE Quality
Moderate
·
Conviction
Undervalued
Trading 36.9% below fair value
You pay
$83.19
Bear
$103.76
Fair
$131.78
Bull
$171.31
Bear
$103.76
+24.7%
ROTCE 20.0% → 4.00x TBV
Fair
$131.78
+58.4%
ROTCE 25.0% → 4.00x TBV
Bull
$171.31
+105.9%
ROTCE 30.0% → 4.00x TBV
Adjust Assumptions
33.9%
7.7%
Key Value Driver
ROTCE (33.9%) vs. cost of equity (7.7%)
Implied Market Multiple
3.21x
Analyst Consensus (External Reference)
Never blended into the bear/base/bull estimates above.
Average Target (9 analysts)
$105.00
Divergence from AlphaVal
26%
Summary
With ROTCE of 33.9% vs. 7.7% cost of equity, fair P/TBV is 4.00x on $25.94 tangible book, implying $131.78 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 $105.00 (from 9 analysts). Our estimate is 26% 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