FMBH
First Mid Bancshares, Inc.
$43.60
Banks, Insurers & Asset Managers
85%
P/Tangible Book × ROE Quality
Mild
·
Conviction
Fair Value
Trading 14.7% below fair value
You pay
$43.60
Bear
$32.65
Fair
$51.10
Bull
$62.17
Bear
$32.65
-25.1%
ROTCE 9.8% → 1.24x TBV
Fair
$51.10
+17.2%
ROTCE 13.0% → 1.94x TBV
Bull
$62.17
+42.6%
ROTCE 15.0% → 2.36x TBV
Key Value Driver
ROTCE (13.0%) vs. cost of equity (8.6%)
Implied Market Multiple
1.64x
Summary
Our base-case estimate uses P/Tangible Book × ROE Quality. We then blend that result with the average analyst price target of $50.00 from 5 analysts, using a 20% weight on analyst consensus. That produces an estimated intrinsic value of $51.10 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: $16.94 (67% below our primary estimate). Large gaps suggest the dividend may not fully reflect the company's value.
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