CG
The Carlyle Group Inc.
$45.43
Banks, Insurers & Asset Managers
90%
P/Tangible Book × ROE Quality
Moderate
·
Conviction
Undervalued
Trading 34.8% below fair value
You pay
$45.43
Bear
$48.81
Fair
$69.73
Bull
$90.65
Bear
$48.81
+7.4%
ROTCE 11.5% → 0.75x TBV
Fair
$69.73
+53.5%
ROTCE 15.4% → 1.14x TBV
Bull
$90.65
+99.5%
ROTCE 17.7% → 1.37x TBV
Key Value Driver
ROTCE (15.4%) vs. cost of equity (14.0%)
Implied Market Multiple
3.11x
Summary
Our base-case estimate uses P/Tangible Book × ROE Quality. We then blend that result with the average analyst price target of $62.86 from 25 analysts, using a 25% weight on analyst consensus. That produces an estimated intrinsic value of $69.73 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: $17.21 (76% 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