NDAQ
Nasdaq, Inc.
$93.48
Banks, Insurers & Asset Managers
80%
P/Tangible Book × ROE Quality
Strong
·
Conviction
Overvalued
Trading 132.7% above fair value
You pay
$93.48
Bear
$26.35
Fair
$40.17
Bull
$48.46
Bear
$26.35
-71.8%
ROTCE 11.0% → 1.20x TBV
Fair
$40.17
-57.0%
ROTCE 14.6% → 1.84x TBV
Bull
$48.46
-48.2%
ROTCE 16.8% → 2.22x TBV
Adjust Assumptions
14.6%
9.8%
Key Value Driver
ROTCE (14.6%) vs. cost of equity (9.8%)
Implied Market Multiple
4.27x
Analyst Consensus (External Reference)
Never blended into the bear/base/bull estimates above.
Average Target (36 analysts)
$110.43
Divergence from AlphaVal
64%
Summary
With ROTCE of 14.6% vs. 9.8% cost of equity, fair P/TBV is 1.84x on $21.87 tangible book, implying $40.17 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 $110.43 (from 36 analysts). Our estimate is 64% below 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