PAX
Patria Investments Ltd
$11.67
Banks, Insurers & Asset Managers
85%
P/Tangible Book × ROE Quality
Moderate
·
Conviction
Undervalued
Trading 28.8% below fair value
You pay
$11.67
Bear
$11.47
Fair
$16.38
Bull
$21.29
Bear
$11.47
-1.7%
ROTCE 10.5% → 1.41x TBV
Fair
$16.38
+40.4%
ROTCE 14.0% → 2.17x TBV
Bull
$21.29
+82.5%
ROTCE 16.1% → 2.62x TBV
Adjust Assumptions
14.0%
8.6%
Key Value Driver
ROTCE (14.0%) vs. cost of equity (8.6%)
Implied Market Multiple
3.08x
Analyst Consensus (External Reference)
Never blended into the bear/base/bull estimates above.
Average Target (5 analysts)
$14.00
Divergence from AlphaVal
17%
Summary
With ROTCE of 14.0% vs. 8.6% cost of equity, fair P/TBV is 2.17x on $3.79 tangible book, implying $16.38 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