NIC
Nicolet Bankshares, Inc.
$164.08
Banks, Insurers & Asset Managers
85%
P/Tangible Book × ROE Quality
Mild
·
Conviction
Fair Value
Trading 12.9% below fair value
You pay
$164.08
Bear
$127.06
Fair
$188.42
Bull
$220.98
Bear
$127.06
-22.6%
ROTCE 12.9% → 2.30x TBV
Fair
$188.42
+14.8%
ROTCE 17.2% → 3.41x TBV
Bull
$220.98
+34.7%
ROTCE 19.8% → 4.00x TBV
Key Value Driver
ROTCE (17.2%) vs. cost of equity (7.9%)
Implied Market Multiple
2.95x
Summary
Our base-case estimate uses P/Tangible Book × ROE Quality. We then blend that result with the average analyst price target of $182.67 from 5 analysts, using a 20% weight on analyst consensus. That produces an estimated intrinsic value of $188.42 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