GCMG
GCM Grosvenor Inc.
$13.72
Banks, Insurers & Asset Managers
90%
P/Tangible Book × ROE Quality
Strong
·
Conviction
Overvalued
Trading 87.9% above fair value
You pay
$13.72
Bear
$5.11
Fair
$7.30
Bull
$9.49
Bear
$5.11
-62.7%
ROTCE 20.0% → 3.29x TBV
Fair
$7.30
-46.8%
ROTCE 25.0% → 4.00x TBV
Bull
$9.49
-30.8%
ROTCE 30.0% → 4.00x TBV
Adjust Assumptions
168.1%
8.9%
Key Value Driver
ROTCE (168.1%) vs. cost of equity (8.9%)
Implied Market Multiple
94.99x
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. 8.9% cost of equity, fair P/TBV is 4.00x on $0.14 tangible book, implying $7.30 per share. DDM cross-check: $9.65.
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: $9.65 (32% above our primary estimate). Large gaps suggest the dividend may not fully reflect the company's value.
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