RBB
RBB Bancorp
$26.85
Banks, Insurers & Asset Managers
85%
P/Tangible Book × ROE Quality
Mild
·
Conviction
Overvalued
Trading 5.2% above fair value
You pay
$26.85
Bear
$17.86
Fair
$25.51
Bull
$33.16
Bear
$17.86
-33.5%
ROTCE 5.3% → 0.30x TBV
Fair
$25.51
-5.0%
ROTCE 7.1% → 0.52x TBV
Bull
$33.16
+23.5%
ROTCE 8.2% → 0.70x TBV
Key Value Driver
ROTCE (7.1%) vs. cost of equity (9.9%)
Implied Market Multiple
1.01x
Summary
Our base-case estimate uses P/Tangible Book × ROE Quality. We then blend that result with the average analyst price target of $29.00 from 7 analysts, using a 20% weight on analyst consensus. That produces an estimated intrinsic value of $25.51 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 (9.9%). This means the bank is worth less than the net assets on its books.
Dividend-based valuation: $10.24 (58% 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