EGBN
Eagle Bancorp, Inc.
$28.24
Banks, Insurers & Asset Managers
85%
P/Tangible Book × ROE Quality
Moderate
·
Conviction
Fair Value
Trading 22.4% below fair value
You pay
$28.24
Bear
$25.49
Fair
$36.41
Bull
$47.33
Bear
$25.49
-9.7%
ROTCE 4.0% → 0.30x TBV
Fair
$36.41
+28.9%
ROTCE -11.2% → 0.30x TBV
Bull
$47.33
+67.6%
ROTCE -12.9% → 0.30x TBV
Adjust Assumptions
-11.2%
9.7%
Key Value Driver
ROTCE (-11.2%) vs. cost of equity (9.7%)
Implied Market Multiple
0.75x
Analyst Consensus (External Reference)
Never blended into the bear/base/bull estimates above.
Average Target (14 analysts)
$30.50
Divergence from AlphaVal
19%
Summary
With ROTCE of -11.2% vs. 9.7% cost of equity, fair P/TBV is 0.30x on $37.42 tangible book, implying $36.41 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.
Return on equity (-11.2%) is below the minimum investors require (9.7%). This means the bank is worth less than the net assets on its books.
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