FHB
First Hawaiian, Inc.
$24.47
Banks, Insurers & Asset Managers
85%
P/Tangible Book × ROE Quality
Moderate
·
Conviction
Undervalued
Trading 35.8% below fair value
You pay
$24.47
Bear
$25.31
Fair
$38.12
Bull
$45.81
Bear
$25.31
+3.4%
ROTCE 11.7% → 1.74x TBV
Fair
$38.12
+55.8%
ROTCE 15.6% → 2.62x TBV
Bull
$45.81
+87.2%
ROTCE 18.0% → 3.15x TBV
Adjust Assumptions
15.6%
8.4%
Key Value Driver
ROTCE (15.6%) vs. cost of equity (8.4%)
Implied Market Multiple
1.68x
Analyst Consensus (External Reference)
Never blended into the bear/base/bull estimates above.
Average Target (18 analysts)
$30.25
Divergence from AlphaVal
26%
Summary
With ROTCE of 15.6% vs. 8.4% cost of equity, fair P/TBV is 2.62x on $14.54 tangible book, implying $38.12 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 $30.25 (from 18 analysts). Our estimate is 26% 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