CCB
Coastal Financial Corporation
$69.66
Banks, Insurers & Asset Managers
85%
P/Tangible Book × ROE Quality
Moderate
·
Conviction
Overvalued
Trading 18.3% above fair value
You pay
$69.66
Bear
$33.76
Fair
$58.87
Bull
$73.93
Bear
$33.76
-51.5%
ROTCE 7.2% → 0.73x TBV
Fair
$58.87
-15.5%
ROTCE 9.7% → 1.27x TBV
Bull
$73.93
+6.1%
ROTCE 11.1% → 1.59x TBV
Key Value Driver
ROTCE (9.7%) vs. cost of equity (8.5%)
Implied Market Multiple
2.18x
Summary
Our base-case estimate uses P/Tangible Book × ROE Quality. We then blend that result with the average analyst price target of $132.50 from 5 analysts, using a 20% weight on analyst consensus. That produces an estimated intrinsic value of $58.87 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 $132.50 (from 5 analysts). Our estimate is 69% below 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