RBB
RBB Bancorp
$26.57
Banks, Insurers & Asset Managers
85%
P/Tangible Book × ROE Quality
Mild
·
Conviction
Overvalued
Trading 7.8% above fair value
You pay
$26.57
Bear
$17.25
Fair
$24.64
Bull
$32.03
Bear
$17.25
-35.1%
ROTCE 5.3% → 0.30x TBV
Fair
$24.64
-7.3%
ROTCE 7.1% → 0.52x TBV
Bull
$32.03
+20.6%
ROTCE 8.2% → 0.71x TBV
Adjust Assumptions
7.1%
9.9%
Key Value Driver
ROTCE (7.1%) vs. cost of equity (9.9%)
Implied Market Multiple
1.0x
Analyst Consensus (External Reference)
Never blended into the bear/base/bull estimates above.
Average Target (7 analysts)
$29.00
Divergence from AlphaVal
15%
Summary
With ROTCE of 7.1% vs. 9.9% cost of equity, fair P/TBV is 0.52x on $26.60 tangible book, implying $24.64 per share. DDM cross-check: $9.69.
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 (7.1%) is below the minimum investors require (9.9%). This means the bank is worth less than the net assets on its books.
Dividend-based valuation: $9.69 (61% below our primary estimate). Large gaps suggest the dividend may not fully reflect the company's value.
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