FCFS
FirstCash Holdings, Inc
$206.73
Banks, Insurers & Asset Managers
80%
P/Tangible Book × ROE Quality
Moderate
·
Conviction
Overvalued
Trading 36.5% above fair value
You pay
$206.73
Bear
$106.00
Fair
$151.44
Bull
$196.88
Bear
$106.00
-48.7%
ROTCE 20.0% → 4.00x TBV
Fair
$151.44
-26.7%
ROTCE 25.0% → 4.00x TBV
Bull
$196.88
-4.8%
ROTCE 30.0% → 4.00x TBV
Key Value Driver
ROTCE (1488.4%) vs. cost of equity (7.2%)
Implied Market Multiple
408.29x
Summary
Our base-case estimate uses P/Tangible Book × ROE Quality. We then blend that result with the average analyst price target of $252.00 from 19 analysts, using a 25% weight on analyst consensus. That produces an estimated intrinsic value of $151.44 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: $228.98 (94% above our primary estimate). Large gaps suggest the dividend may not fully reflect the company's value.
Wall Street's average price target is $252.00 (from 19 analysts). Our estimate is 53% 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