LWCL
Lewis & Clark Bancorp
$6.25
Banks, Insurers & Asset Managers
90%
P/Tangible Book × ROE Quality
Strong
·
Conviction
Undervalued
Trading 68.1% below fair value
You pay
$6.25
Bear
$13.73
Fair
$19.62
Bull
$25.50
Bear
$13.73
+119.7%
ROTCE 4.0% → 0.30x TBV
Fair
$19.62
+213.9%
ROTCE 0.2% → 0.30x TBV
Bull
$25.50
+308.0%
ROTCE 0.2% → 0.30x TBV
Key Value Driver
ROTCE (0.2%) vs. cost of equity (6.0%)
Implied Market Multiple
0.21x
Summary
With ROTCE of 0.2% vs. 6.0% cost of equity, fair P/TBV is 0.30x on $30.34 tangible book, implying $19.62 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 (0.2%) is below the minimum investors require (6.0%). 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