CB
Chubb Limited
$352.16
Banks, Insurers & Asset Managers
85%
P/Tangible Book × ROE Quality
Moderate
·
Conviction
Fair Value
Trading 20.3% below fair value
You pay
$352.16
Bear
$326.33
Fair
$442.11
Bull
$574.75
Bear
$326.33
-7.3%
ROTCE 20.0% → 4.00x TBV
Fair
$442.11
+25.5%
ROTCE 25.0% → 4.00x TBV
Bull
$574.75
+63.2%
ROTCE 30.0% → 4.00x TBV
Key Value Driver
ROTCE (30.0%) vs. cost of equity (6.5%)
Implied Market Multiple
3.98x
Summary
Our base-case estimate uses P/Tangible Book × ROE Quality. We then blend that result with the average analyst price target of $354.64 from 43 analysts, using a 30% weight on analyst consensus. That produces an estimated intrinsic value of $442.11 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: $161.43 (66% below our primary estimate). Large gaps suggest the dividend may not fully reflect the company's value.
Wall Street's average price target is $354.64 (from 43 analysts). Our estimate is 35% 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