HONE
HarborOne Bancorp, Inc.
$12.10
Banks, Insurers & Asset Managers
85%
P/Tangible Book × ROE Quality
Moderate
·
Conviction
Overvalued
Trading 34.1% above fair value
You pay
$12.10
Bear
$6.31
Fair
$9.02
Bull
$11.73
Bear
$6.31
-47.8%
ROTCE 4.4% → 0.30x TBV
Fair
$9.02
-25.5%
ROTCE 5.8% → 0.44x TBV
Bull
$11.73
-3.1%
ROTCE 6.7% → 0.65x TBV
Adjust Assumptions
5.8%
8.1%
Key Value Driver
ROTCE (5.8%) vs. cost of equity (8.1%)
Implied Market Multiple
1.11x
Analyst Consensus (External Reference)
Never blended into the bear/base/bull estimates above.
Average Target (6 analysts)
$14.00
Divergence from AlphaVal
36%
Summary
With ROTCE of 5.8% vs. 8.1% cost of equity, fair P/TBV is 0.44x on $10.91 tangible book, implying $9.02 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 (5.8%) is below the minimum investors require (8.1%). This means the bank is worth less than the net assets on its books.
Wall Street's average price target is $14.00 (from 6 analysts). Our estimate is 36% 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