FNF
Fidelity National Financial, Inc.
$39.77
Banks, Insurers & Asset Managers
85%
P/Tangible Book × ROE Quality
Strong
·
Conviction
Undervalued
Trading 43.0% below fair value
You pay
$39.77
Bear
$48.82
Fair
$69.75
Bull
$90.67
Bear
$48.82
+22.8%
ROTCE 6.1% → 0.37x TBV
Fair
$69.75
+75.4%
ROTCE 8.1% → 0.72x TBV
Bull
$90.67
+128.0%
ROTCE 9.3% → 0.94x TBV
Adjust Assumptions
8.1%
9.7%
Key Value Driver
ROTCE (8.1%) vs. cost of equity (9.7%)
Implied Market Multiple
1.44x
Analyst Consensus (External Reference)
Never blended into the bear/base/bull estimates above.
Average Target (17 analysts)
$56.00
Divergence from AlphaVal
25%
Summary
With ROTCE of 8.1% vs. 9.7% cost of equity, fair P/TBV is 0.72x on $27.58 tangible book, implying $69.75 per share. DDM cross-check: $34.27.
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.
Return on equity (8.1%) is below the minimum investors require (9.7%). This means the bank is worth less than the net assets on its books.
Dividend-based valuation: $34.27 (51% 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