NIC
Nicolet Bankshares, Inc.
$171.74
Banks, Insurers & Asset Managers
85%
P/Tangible Book × ROE Quality
Mild
·
Conviction
Fair Value
Trading 1.5% below fair value
You pay
$171.74
Bear
$117.54
Fair
$174.31
Bull
$202.69
Bear
$117.54
-31.6%
ROTCE 12.9% → 2.32x TBV
Fair
$174.31
+1.5%
ROTCE 17.2% → 3.44x TBV
Bull
$202.69
+18.0%
ROTCE 19.8% → 4.00x TBV
Adjust Assumptions
17.2%
7.8%
Key Value Driver
ROTCE (17.2%) vs. cost of equity (7.8%)
Implied Market Multiple
3.39x
Analyst Consensus (External Reference)
Never blended into the bear/base/bull estimates above.
Average Target (5 analysts)
$194.00
Divergence from AlphaVal
10%
Summary
With ROTCE of 17.2% vs. 7.8% cost of equity, fair P/TBV is 3.44x on $50.67 tangible book, implying $174.31 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.
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