FCNCA
First Citizens BancShares, Inc.
$2,155.36
Banks, Insurers & Asset Managers
90%
P/Tangible Book × ROE Quality
Moderate
·
Conviction
Undervalued
Trading 34.4% below fair value
You pay
$2,155.36
Bear
$1,930.13
Fair
$3,283.34
Bull
$4,095.26
Bear
$1,930.13
-10.5%
ROTCE 7.6% → 1.01x TBV
Fair
$3,283.34
+52.3%
ROTCE 10.2% → 1.72x TBV
Bull
$4,095.26
+90.0%
ROTCE 11.7% → 2.15x TBV
Adjust Assumptions
10.2%
7.6%
Key Value Driver
ROTCE (10.2%) vs. cost of equity (7.6%)
Implied Market Multiple
1.13x
Analyst Consensus (External Reference)
Never blended into the bear/base/bull estimates above.
Average Target (11 analysts)
$2289.83
Divergence from AlphaVal
43%
Summary
With ROTCE of 10.2% vs. 7.6% cost of equity, fair P/TBV is 1.72x on $1904.85 tangible book, implying $3283.34 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.
Wall Street's average price target is $2289.83 (from 11 analysts). Our estimate is 43% 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