RNR
RenaissanceRe Holdings Ltd.
$320.79
Banks, Insurers & Asset Managers
85%
P/Tangible Book × ROE Quality
Strong
·
Conviction
Undervalued
Trading 58.0% below fair value
Bear
$764.42
+138.3%
ROTCE 20.0% → 4.00x TBV
Fair
$764.42
+138.3%
ROTCE 25.0% → 4.00x TBV
Bull
$764.42
+138.3%
ROTCE 30.0% → 4.00x TBV
Key Value Driver
ROTCE (28.4%) vs. cost of equity (6.0%)
Implied Market Multiple
1.41x
Summary
Our base-case estimate uses P/Tangible Book × ROE Quality. We then blend that result with the average analyst price target of $332.29 from 28 analysts, using a 25% weight on analyst consensus. That produces an estimated intrinsic value of $764.42 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.
Dividend-based valuation: $42.53 (95% below our primary estimate). Large gaps suggest the dividend may not fully reflect the company's value.
Wall Street's average price target is $332.29 (from 28 analysts). Our estimate is 173% above 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