GCMG
GCM Grosvenor Inc.
$12.88
Banks, Insurers & Asset Managers
90%
P/Tangible Book × ROE Quality
Strong
·
Conviction
Overvalued
Trading 76.4% above fair value
You pay
$12.88
Bear
$5.11
Fair
$7.30
Bull
$9.49
Bear
$5.11
-60.3%
ROTCE 20.0% → 3.09x TBV
Fair
$7.30
-43.3%
ROTCE 25.0% → 4.00x TBV
Bull
$9.49
-26.3%
ROTCE 30.0% → 4.00x TBV
Adjust Assumptions
168.1%
9.2%
Key Value Driver
ROTCE (168.1%) vs. cost of equity (9.2%)
Implied Market Multiple
29.16x
Analyst Consensus (External Reference)
Never blended into the bear/base/bull estimates above.
Average Target (8 analysts)
$17.00
Divergence from AlphaVal
57%
Summary
With ROTCE of 168.1% vs. 9.2% cost of equity, fair P/TBV is 4.00x on $0.44 tangible book, implying $7.30 per share. DDM cross-check: $9.10.
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 $17.00 (from 8 analysts). Our estimate is 57% below 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