EG
Everest Group, Ltd.
$398.60
Banks, Insurers & Asset Managers
85%
P/Tangible Book × ROE Quality
Strong
·
Conviction
Undervalued
Trading 70.5% below fair value
You pay
$398.60
Bear
$830.26
Fair
$1,348.94
Bull
$1,451.54
Bear
$830.26
+108.3%
ROTCE 8.6% → 2.29x TBV
Fair
$1,348.94
+238.4%
ROTCE 11.4% → 3.72x TBV
Bull
$1,451.54
+264.2%
ROTCE 13.1% → 4.00x TBV
Adjust Assumptions
11.4%
6.0%
Key Value Driver
ROTCE (11.4%) vs. cost of equity (6.0%)
Implied Market Multiple
1.1x
Analyst Consensus (External Reference)
Never blended into the bear/base/bull estimates above.
Average Target (22 analysts)
$411.00
Divergence from AlphaVal
228%
Summary
With ROTCE of 11.4% vs. 6.0% cost of equity, fair P/TBV is 3.72x on $362.88 tangible book, implying $1348.94 per share. DDM cross-check: $582.51.
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: $582.51 (57% below our primary estimate). Large gaps suggest the dividend may not fully reflect the company's value.
Wall Street's average price target is $411.00 (from 22 analysts). Our estimate is 228% 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