CBAN
Colony Bankcorp, Inc.
$21.17
Banks, Insurers & Asset Managers
85%
P/Tangible Book × ROE Quality
Mild
·
Conviction
Fair Value
Trading 8.9% below fair value
You pay
$21.17
Bear
$13.04
Fair
$23.25
Bull
$29.37
Bear
$13.04
-38.4%
ROTCE 7.0% → 0.91x TBV
Fair
$23.25
+9.8%
ROTCE 9.3% → 1.62x TBV
Bull
$29.37
+38.8%
ROTCE 10.7% → 2.04x TBV
Adjust Assumptions
9.3%
7.3%
Key Value Driver
ROTCE (9.3%) vs. cost of equity (7.3%)
Implied Market Multiple
1.47x
Summary
With ROTCE of 9.3% vs. 7.3% cost of equity, fair P/TBV is 1.62x on $14.38 tangible book, implying $23.25 per share. DDM cross-check: $9.63.
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: $9.63 (59% 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