CG
The Carlyle Group Inc.
$42.34
Banks, Insurers & Asset Managers
90%
P/Tangible Book × ROE Quality
Strong
·
Conviction
Undervalued
Trading 41.2% below fair value
You pay
$42.34
Bear
$50.41
Fair
$72.02
Bull
$93.63
Bear
$50.41
+19.1%
ROTCE 11.5% → 0.75x TBV
Fair
$72.02
+70.1%
ROTCE 15.4% → 1.14x TBV
Bull
$93.63
+121.1%
ROTCE 17.7% → 1.37x TBV
Adjust Assumptions
15.4%
14.0%
Key Value Driver
ROTCE (15.4%) vs. cost of equity (14.0%)
Implied Market Multiple
2.9x
Analyst Consensus (External Reference)
Never blended into the bear/base/bull estimates above.
Average Target (26 analysts)
$56.71
Divergence from AlphaVal
27%
Summary
With ROTCE of 15.4% vs. 14.0% cost of equity, fair P/TBV is 1.14x on $14.60 tangible book, implying $72.02 per share. DDM cross-check: $14.58.
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: $14.58 (80% below our primary estimate). Large gaps suggest the dividend may not fully reflect the company's value.
Wall Street's average price target is $56.71 (from 26 analysts). Our estimate is 27% 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