PIPR
Piper Sandler Companies
$76.32
Banks, Insurers & Asset Managers
85%
P/Tangible Book × ROE Quality
Moderate
·
Conviction
Overvalued
Trading 18.5% above fair value
You pay
$76.32
Bear
$45.06
Fair
$64.38
Bull
$83.70
Bear
$45.06
-41.0%
ROTCE 20.0% → 1.96x TBV
Fair
$64.38
-15.6%
ROTCE 25.0% → 3.13x TBV
Bull
$83.70
+9.7%
ROTCE 30.0% → 3.19x TBV
Key Value Driver
ROTCE (29.5%) vs. cost of equity (12.2%)
Implied Market Multiple
5.42x
Summary
Our base-case estimate uses P/Tangible Book × ROE Quality. We then blend that result with the average analyst price target of $96.63 from 11 analysts, using a 20% weight on analyst consensus. That produces an estimated intrinsic value of $64.38 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.
Wall Street's average price target is $96.63 (from 11 analysts). Our estimate is 42% 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