GLRE
Greenlight Capital Re, Ltd.
$17.19
Banks, Insurers & Asset Managers
85%
P/Tangible Book × ROE Quality
Strong
·
Conviction
Undervalued
Trading 72.9% below fair value
You pay
$17.19
Bear
$39.94
Fair
$63.43
Bull
$73.33
Bear
$39.94
+132.3%
ROTCE 9.2% → 2.18x TBV
Fair
$63.43
+269.0%
ROTCE 12.3% → 3.46x TBV
Bull
$73.33
+326.6%
ROTCE 14.2% → 4.00x TBV
Key Value Driver
ROTCE (12.3%) vs. cost of equity (6.4%)
Implied Market Multiple
0.94x
Summary
With ROTCE of 12.3% vs. 6.4% cost of equity, fair P/TBV is 3.46x on $18.33 tangible book, implying $63.43 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