OWL
Blue Owl Capital Inc.
$9.34
Banks, Insurers & Asset Managers
90%
P/Tangible Book × ROE Quality
Strong
·
Conviction
Overvalued
Trading 226.6% above fair value
You pay
$9.34
Bear
$2.00
Fair
$2.86
Bull
$3.72
Bear
$2.00
-78.6%
ROTCE 4.0% → 0.30x TBV
Fair
$2.86
-69.4%
ROTCE 3.6% → 0.30x TBV
Bull
$3.72
-60.2%
ROTCE 4.1% → 0.30x TBV
Adjust Assumptions
3.6%
10.9%
Key Value Driver
ROTCE (3.6%) vs. cost of equity (10.9%)
Implied Market Multiple
6.62x
Analyst Consensus (External Reference)
Never blended into the bear/base/bull estimates above.
Average Target (19 analysts)
$11.01
Divergence from AlphaVal
74%
Summary
With ROTCE of 3.6% vs. 10.9% cost of equity, fair P/TBV is 0.30x on $1.41 tangible book, implying $2.86 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.
Return on equity (3.6%) is below the minimum investors require (10.9%). This means the bank is worth less than the net assets on its books.
Wall Street's average price target is $11.01 (from 19 analysts). Our estimate is 74% 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