GS
The Goldman Sachs Group, Inc.
$1,065.22
Banks, Insurers & Asset Managers
90%
P/Tangible Book × ROE Quality
Mild
·
Conviction
Fair Value
Trading 3.7% below fair value
You pay
$1,065.22
Bear
$774.37
Fair
$1,106.24
Bull
$1,438.10
Bear
$774.37
-27.3%
ROTCE 10.9% → 0.93x TBV
Fair
$1,106.24
+3.9%
ROTCE 14.5% → 1.42x TBV
Bull
$1,438.10
+35.0%
ROTCE 16.7% → 1.72x TBV
Key Value Driver
ROTCE (14.5%) vs. cost of equity (11.4%)
Implied Market Multiple
2.66x
Summary
Our base-case estimate uses P/Tangible Book × ROE Quality. We then blend that result with the average analyst price target of $1203.17 from 55 analysts, using a 35% weight on analyst consensus. That produces an estimated intrinsic value of $1106.24 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