FRST
Primis Financial Corp.
$14.33
Banks, Insurers & Asset Managers
85%
P/Tangible Book × ROE Quality
Strong
·
Conviction
Undervalued
Trading 67.2% below fair value
You pay
$14.33
Bear
$29.76
Fair
$43.65
Bull
$51.99
Bear
$29.76
+107.7%
ROTCE 14.0% → 2.24x TBV
Fair
$43.65
+204.6%
ROTCE 18.7% → 3.28x TBV
Bull
$51.99
+262.8%
ROTCE 21.5% → 3.91x TBV
Key Value Driver
ROTCE (18.7%) vs. cost of equity (8.5%)
Implied Market Multiple
1.08x
Summary
With ROTCE of 18.7% vs. 8.5% cost of equity, fair P/TBV is 3.28x on $13.30 tangible book, implying $43.65 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.
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