MKL
Markel Corporation
$1,857.89
Banks, Insurers & Asset Managers
85%
P/Tangible Book × ROE Quality
Moderate
·
Conviction
Undervalued
Trading 34.8% below fair value
You pay
$1,857.89
Bear
$1,897.37
Fair
$2,851.66
Bull
$3,424.22
Bear
$1,897.37
+2.1%
ROTCE 11.9% → 1.97x TBV
Fair
$2,851.66
+53.5%
ROTCE 15.8% → 2.96x TBV
Bull
$3,424.22
+84.3%
ROTCE 18.2% → 3.56x TBV
Key Value Driver
ROTCE (15.8%) vs. cost of equity (8.0%)
Implied Market Multiple
1.75x
Summary
Our base-case estimate uses P/Tangible Book × ROE Quality. We then blend that result with the average analyst price target of $1950.00 from 15 analysts, using a 25% weight on analyst consensus. That produces an estimated intrinsic value of $2851.66 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.
Wall Street's average price target is $1950.00 (from 15 analysts). Our estimate is 62% above 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