INBK
First Internet Bancorp
$26.59
Banks, Insurers & Asset Managers
85%
P/Tangible Book × ROE Quality
Moderate
·
Conviction
Fair Value
Trading 16.1% below fair value
You pay
$26.59
Bear
$22.18
Fair
$31.68
Bull
$41.18
Bear
$22.18
-16.6%
ROTCE 4.0% → 0.30x TBV
Fair
$31.68
+19.1%
ROTCE -9.9% → 0.30x TBV
Bull
$41.18
+54.9%
ROTCE -11.4% → 0.30x TBV
Adjust Assumptions
-9.9%
9.1%
Key Value Driver
ROTCE (-9.9%) vs. cost of equity (9.1%)
Implied Market Multiple
0.65x
Analyst Consensus (External Reference)
Never blended into the bear/base/bull estimates above.
Average Target (11 analysts)
$29.50
Divergence from AlphaVal
7%
Summary
With ROTCE of -9.9% vs. 9.1% cost of equity, fair P/TBV is 0.30x on $40.66 tangible book, implying $31.68 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 (-9.9%) is below the minimum investors require (9.1%). This means the bank is worth less than the net assets on its books.
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