CNO
CNO Financial Group, Inc.
$54.71
Banks, Insurers & Asset Managers
90%
P/Tangible Book × ROE Quality
Mild
·
Conviction
Fair Value
Trading 9.5% below fair value
You pay
$54.71
Bear
$42.34
Fair
$60.48
Bull
$78.62
Bear
$42.34
-22.6%
ROTCE 20.0% → 3.35x TBV
Fair
$60.48
+10.5%
ROTCE 25.0% → 4.00x TBV
Bull
$78.62
+43.7%
ROTCE 30.0% → 4.00x TBV
Adjust Assumptions
235.7%
8.8%
Key Value Driver
ROTCE (235.7%) vs. cost of equity (8.8%)
Implied Market Multiple
52.02x
Analyst Consensus (External Reference)
Never blended into the bear/base/bull estimates above.
Average Target (17 analysts)
$57.67
Divergence from AlphaVal
5%
Summary
With ROTCE of 235.7% vs. 8.8% cost of equity, fair P/TBV is 4.00x on $1.05 tangible book, implying $60.48 per share. DDM cross-check: $21.41.
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: $21.41 (65% 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