CVBF
CVB Financial Corp.
$21.53
Banks, Insurers & Asset Managers
85%
P/Tangible Book × ROE Quality
Moderate
·
Conviction
Fair Value
Trading 17.3% below fair value
You pay
$21.53
Bear
$16.85
Fair
$26.03
Bull
$31.53
Bear
$16.85
-21.8%
ROTCE 10.3% → 1.59x TBV
Fair
$26.03
+20.9%
ROTCE 13.7% → 2.45x TBV
Bull
$31.53
+46.5%
ROTCE 15.8% → 2.97x TBV
Adjust Assumptions
13.7%
8.0%
Key Value Driver
ROTCE (13.7%) vs. cost of equity (8.0%)
Implied Market Multiple
2.03x
Analyst Consensus (External Reference)
Never blended into the bear/base/bull estimates above.
Average Target (16 analysts)
$26.67
Divergence from AlphaVal
2%
Summary
With ROTCE of 13.7% vs. 8.0% cost of equity, fair P/TBV is 2.45x on $10.62 tangible book, implying $26.03 per share. DDM cross-check: $12.14.
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: $12.14 (53% 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