GCMG
GCM Grosvenor Inc.
$13.73
Banks, Insurers & Asset Managers
90%
P/Tangible Book × ROE Quality
Mild
·
Conviction
Fair Value
Trading 11.6% below fair value
You pay
$13.73
Bear
$10.88
Fair
$15.54
Bull
$20.20
Bear
$10.88
-20.7%
ROTCE 20.0% → 3.25x TBV
Fair
$15.54
+13.2%
ROTCE 25.0% → 4.00x TBV
Bull
$20.20
+47.1%
ROTCE 30.0% → 4.00x TBV
Key Value Driver
ROTCE (168.1%) vs. cost of equity (8.9%)
Implied Market Multiple
95.06x
Summary
Our base-case estimate uses P/Tangible Book × ROE Quality. We then blend that result with the average analyst price target of $18.00 from 8 analysts, using a 20% weight on analyst consensus. That produces an estimated intrinsic value of $15.54 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: $9.52 (36% 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