NBTB
NBT Bancorp Inc.
$50.30
Banks, Insurers & Asset Managers
85%
P/Tangible Book × ROE Quality
Moderate
·
Conviction
Undervalued
Trading 30.5% below fair value
You pay
$50.30
Bear
$45.49
Fair
$72.41
Bull
$88.55
Bear
$45.49
-9.6%
ROTCE 9.2% → 1.71x TBV
Fair
$72.41
+43.9%
ROTCE 12.2% → 2.72x TBV
Bull
$88.55
+76.1%
ROTCE 14.0% → 3.32x TBV
Adjust Assumptions
12.2%
7.0%
Key Value Driver
ROTCE (12.2%) vs. cost of equity (7.0%)
Implied Market Multiple
1.89x
Analyst Consensus (External Reference)
Never blended into the bear/base/bull estimates above.
Average Target (10 analysts)
$56.67
Divergence from AlphaVal
28%
Summary
With ROTCE of 12.2% vs. 7.0% cost of equity, fair P/TBV is 2.72x on $26.63 tangible book, implying $72.41 per share. DDM cross-check: $128.83.
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: $128.83 (78% above our primary estimate). Large gaps suggest the dividend may not fully reflect the company's value.
Wall Street's average price target is $56.67 (from 10 analysts). Our estimate is 28% 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