CB
Chubb Limited
$327.89
Banks, Insurers & Asset Managers
85%
P/Tangible Book × ROE Quality
Moderate
·
Conviction
Undervalued
Trading 25.3% below fair value
You pay
$327.89
Bear
$324.05
Fair
$439.02
Bull
$570.72
Bear
$324.05
-1.2%
ROTCE 20.0% → 4.00x TBV
Fair
$439.02
+33.9%
ROTCE 25.0% → 4.00x TBV
Bull
$570.72
+74.1%
ROTCE 30.0% → 4.00x TBV
Key Value Driver
ROTCE (30.0%) vs. cost of equity (6.7%)
Implied Market Multiple
3.7x
Summary
Our base-case estimate uses P/Tangible Book × ROE Quality. We then blend that result with the average analyst price target of $344.33 from 43 analysts, using a 30% weight on analyst consensus. That produces an estimated intrinsic value of $439.02 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: $144.48 (70% below our primary estimate). Large gaps suggest the dividend may not fully reflect the company's value.
Wall Street's average price target is $344.33 (from 43 analysts). Our estimate is 39% 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