RBB
RBB Bancorp
$23.76
Banks, Insurers & Asset Managers
85%
P/Tangible Book × ROE Quality
Mild
·
Conviction
Fair Value
Trading 1.5% below fair value
You pay
$23.76
Bear
$16.88
Fair
$24.11
Bull
$31.34
Bear
$16.88
-29.0%
ROTCE 5.3% → 0.30x TBV
Fair
$24.11
+1.5%
ROTCE 7.1% → 0.50x TBV
Bull
$31.34
+31.9%
ROTCE 8.2% → 0.68x TBV
Key Value Driver
ROTCE (7.1%) vs. cost of equity (10.1%)
Implied Market Multiple
0.89x
Summary
Our base-case estimate uses P/Tangible Book × ROE Quality. We then blend that result with the average analyst price target of $22.00 from 6 analysts, using a 20% weight on analyst consensus. That produces an estimated intrinsic value of $24.11 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 (7.1%) is below the minimum investors require (10.1%). This means the bank is worth less than the net assets on its books.
Dividend-based valuation: $9.92 (60% 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