GSHD
Goosehead Insurance, Inc
$45.23
Banks, Insurers & Asset Managers
85%
P/Tangible Book × ROE Quality
Strong
·
Conviction
Overvalued
Trading 585.3% above fair value
You pay
$45.23
Bear
$4.62
Fair
$6.60
Bull
$8.58
Bear
$4.62
-89.8%
ROTCE 4.0% → 0.30x TBV
Fair
$6.60
-85.4%
ROTCE 0.0% → 0.30x TBV
Bull
$8.58
-81.0%
ROTCE 0.0% → 0.30x TBV
Adjust Assumptions
0.0%
11.8%
Key Value Driver
ROTCE (0.0%) vs. cost of equity (11.8%)
Implied Market Multiple
7.54x
Analyst Consensus (External Reference)
Never blended into the bear/base/bull estimates above.
Average Target (18 analysts)
$69.50
Divergence from AlphaVal
91%
Summary
With ROTCE of 0.0% vs. 11.8% cost of equity, fair P/TBV is 0.30x on $6.00 tangible book, implying $6.60 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 (11.8%). This means the bank is worth less than the net assets on its books.
Wall Street's average price target is $69.50 (from 18 analysts). Our estimate is 91% 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