GPN
Global Payments Inc.
$81.86
Banks, Insurers & Asset Managers
80%
P/Tangible Book × ROE Quality
Mild
·
Conviction
Fair Value
Trading 1.3% below fair value
You pay
$81.86
Bear
$58.06
Fair
$82.94
Bull
$107.82
Bear
$58.06
-29.1%
ROTCE 20.0% → 3.38x TBV
Fair
$82.94
+1.3%
ROTCE 25.0% → 4.00x TBV
Bull
$107.82
+31.7%
ROTCE 30.0% → 4.00x TBV
Adjust Assumptions
88.6%
8.7%
Key Value Driver
ROTCE (88.6%) vs. cost of equity (8.7%)
Implied Market Multiple
13.7x
Analyst Consensus (External Reference)
Never blended into the bear/base/bull estimates above.
Average Target (63 analysts)
$102.88
Divergence from AlphaVal
19%
Summary
With ROTCE of 88.6% vs. 8.7% cost of equity, fair P/TBV is 4.00x on $5.97 tangible book, implying $82.94 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