COLB
Columbia Banking System, Inc.
$33.24
Banks, Insurers & Asset Managers
85%
P/Tangible Book × ROE Quality
Mild
·
Conviction
Fair Value
Trading 3.3% below fair value
You pay
$33.24
Bear
$19.80
Fair
$34.39
Bull
$43.14
Bear
$19.80
-40.4%
ROTCE 7.3% → 0.84x TBV
Fair
$34.39
+3.5%
ROTCE 9.7% → 1.46x TBV
Bull
$43.14
+29.8%
ROTCE 11.2% → 1.83x TBV
Key Value Driver
ROTCE (9.7%) vs. cost of equity (7.9%)
Implied Market Multiple
1.4x
Summary
Our base-case estimate uses P/Tangible Book × ROE Quality. We then blend that result with the average analyst price target of $33.58 from 19 analysts, using a 25% weight on analyst consensus. That produces an estimated intrinsic value of $34.39 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: $44.69 (29% 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