HLNE
Hamilton Lane Incorporated
$85.67
Banks, Insurers & Asset Managers
85%
P/Tangible Book × ROE Quality
Moderate
·
Conviction
Fair Value
Trading 17.2% below fair value
You pay
$85.67
Bear
$72.44
Fair
$103.48
Bull
$134.52
Bear
$72.44
-15.4%
ROTCE 20.0% → 2.24x TBV
Fair
$103.48
+20.8%
ROTCE 25.0% → 2.94x TBV
Bull
$134.52
+57.0%
ROTCE 30.0% → 3.64x TBV
Adjust Assumptions
27.2%
11.1%
Key Value Driver
ROTCE (27.2%) vs. cost of equity (11.1%)
Implied Market Multiple
5.2x
Analyst Consensus (External Reference)
Never blended into the bear/base/bull estimates above.
Average Target (10 analysts)
$125.00
Divergence from AlphaVal
17%
Summary
With ROTCE of 27.2% vs. 11.1% cost of equity, fair P/TBV is 2.94x on $16.48 tangible book, implying $103.48 per share. DDM cross-check: $102.76.
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