GLRE
Greenlight Capital Re, Ltd.
$15.03
Banks, Insurers & Asset Managers
85%
P/Tangible Book × ROE Quality
Strong
·
Conviction
Undervalued
Trading 79.8% below fair value
You pay
$15.03
Bear
$47.17
Fair
$74.51
Bull
$74.51
Bear
$47.17
+213.8%
ROTCE 9.2% → 2.53x TBV
Fair
$74.51
+395.7%
ROTCE 12.3% → 4.00x TBV
Bull
$74.51
+395.7%
ROTCE 14.2% → 4.00x TBV
Adjust Assumptions
12.3%
6.1%
Key Value Driver
ROTCE (12.3%) vs. cost of equity (6.1%)
Implied Market Multiple
0.81x
Summary
With ROTCE of 12.3% vs. 6.1% cost of equity, fair P/TBV is 4.00x on $18.63 tangible book, implying $74.51 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