FBNC
First Bancorp
$58.65
Banks, Insurers & Asset Managers
85%
P/Tangible Book × ROE Quality
Strong
·
Conviction
Overvalued
Trading 44.6% above fair value
You pay
$58.65
Bear
$28.39
Fair
$40.55
Bull
$52.72
Bear
$28.39
-51.6%
ROTCE 7.2% → 0.66x TBV
Fair
$40.55
-30.9%
ROTCE 9.6% → 1.15x TBV
Bull
$52.72
-10.1%
ROTCE 11.0% → 1.44x TBV
Key Value Driver
ROTCE (9.6%) vs. cost of equity (8.9%)
Implied Market Multiple
2.1x
Summary
Our base-case estimate uses P/Tangible Book × ROE Quality. We then blend that result with the average analyst price target of $63.00 from 16 analysts, using a 25% weight on analyst consensus. That produces an estimated intrinsic value of $40.55 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: $15.10 (54% below our primary estimate). Large gaps suggest the dividend may not fully reflect the company's value.
Wall Street's average price target is $63.00 (from 16 analysts). Our estimate is 48% below 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