MET
MetLife, Inc.
$100.04
Banks, Insurers & Asset Managers
85%
P/Tangible Book × ROE Quality
Mild
·
Conviction
Overvalued
Trading 12.3% above fair value
You pay
$100.04
Bear
$62.37
Fair
$89.10
Bull
$115.83
Bear
$62.37
-37.7%
ROTCE 8.9% → 1.08x TBV
Fair
$89.10
-10.9%
ROTCE 11.9% → 1.73x TBV
Bull
$115.83
+15.8%
ROTCE 13.7% → 2.12x TBV
Adjust Assumptions
11.9%
8.6%
Key Value Driver
ROTCE (11.9%) vs. cost of equity (8.6%)
Implied Market Multiple
2.24x
Analyst Consensus (External Reference)
Never blended into the bear/base/bull estimates above.
Average Target (33 analysts)
$108.25
Divergence from AlphaVal
18%
Summary
With ROTCE of 11.9% vs. 8.6% cost of equity, fair P/TBV is 1.73x on $44.69 tangible book, implying $89.10 per share. DDM cross-check: $47.37.
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.
Dividend-based valuation: $47.37 (47% below our primary estimate). Large gaps suggest the dividend may not fully reflect the company's value.
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