CTBI
Community Trust Bancorp, Inc.
$66.70
Banks, Insurers & Asset Managers
85%
P/Tangible Book × ROE Quality
Moderate
·
Conviction
Undervalued
Trading 31.9% below fair value
You pay
$66.70
Bear
$61.79
Fair
$97.94
Bull
$119.61
Bear
$61.79
-7.4%
ROTCE 9.3% → 1.55x TBV
Fair
$97.94
+46.8%
ROTCE 12.4% → 2.46x TBV
Bull
$119.61
+79.3%
ROTCE 14.3% → 3.01x TBV
Key Value Driver
ROTCE (12.4%) vs. cost of equity (7.4%)
Implied Market Multiple
1.53x
Summary
Our base-case estimate uses P/Tangible Book × ROE Quality. We then blend that result with the average analyst price target of $61.00 from 6 analysts, using a 20% weight on analyst consensus. That produces an estimated intrinsic value of $97.94 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: $138.15 (29% above our primary estimate). Large gaps suggest the dividend may not fully reflect the company's value.
Wall Street's average price target is $61.00 (from 6 analysts). Our estimate is 76% 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