GSHD
Goosehead Insurance, Inc
$43.97
Banks, Insurers & Asset Managers
85%
P/Tangible Book × ROE Quality
Strong
·
Conviction
Overvalued
Trading 128.1% above fair value
You pay
$43.97
Bear
$13.49
Fair
$19.27
Bull
$25.09
Bear
$13.49
-69.3%
ROTCE 4.0% → 0.30x TBV
Fair
$19.27
-56.2%
ROTCE 0.0% → 0.30x TBV
Bull
$25.09
-42.9%
ROTCE 0.0% → 0.30x TBV
Key Value Driver
ROTCE (0.0%) vs. cost of equity (12.4%)
Implied Market Multiple
7.8x
Summary
Our base-case estimate uses P/Tangible Book × ROE Quality. We then blend that result with the average analyst price target of $58.50 from 18 analysts, using a 25% weight on analyst consensus. That produces an estimated intrinsic value of $19.27 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.
Return on equity (0.0%) is below the minimum investors require (12.4%). This means the bank is worth less than the net assets on its books.
Wall Street's average price target is $58.50 (from 18 analysts). Our estimate is 89% 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