COLB
Columbia Banking System, Inc.
$28.37
Banks, Insurers & Asset Managers
85%
P/Tangible Book × ROE Quality
Mild
·
Conviction
Fair Value
Trading 4.1% below fair value
You pay
$28.37
Bear
$17.03
Fair
$29.58
Bull
$37.11
Bear
$17.03
-40.0%
ROTCE 7.3% → 0.85x TBV
Fair
$29.58
+4.3%
ROTCE 9.7% → 1.48x TBV
Bull
$37.11
+30.8%
ROTCE 11.2% → 1.86x TBV
Adjust Assumptions
9.7%
7.9%
Key Value Driver
ROTCE (9.7%) vs. cost of equity (7.9%)
Implied Market Multiple
1.42x
Analyst Consensus (External Reference)
Never blended into the bear/base/bull estimates above.
Average Target (19 analysts)
$34.20
Divergence from AlphaVal
14%
Summary
With ROTCE of 9.7% vs. 7.9% cost of equity, fair P/TBV is 1.48x on $19.96 tangible book, implying $29.58 per share. DDM cross-check: $42.98.
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: $42.98 (45% above 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