SFST
Southern First Bancshares, Inc.
$59.13
Banks, Insurers & Asset Managers
85%
P/Tangible Book × ROE Quality
Moderate
·
Conviction
Overvalued
Trading 36.5% above fair value
You pay
$59.13
Bear
$30.32
Fair
$43.32
Bull
$56.32
Bear
$30.32
-48.7%
ROTCE 6.2% → 0.51x TBV
Fair
$43.32
-26.7%
ROTCE 8.2% → 1.00x TBV
Bull
$56.32
-4.8%
ROTCE 9.5% → 1.29x TBV
Adjust Assumptions
8.2%
8.2%
Key Value Driver
ROTCE (8.2%) vs. cost of equity (8.2%)
Implied Market Multiple
1.52x
Analyst Consensus (External Reference)
Never blended into the bear/base/bull estimates above.
Average Target (7 analysts)
$64.00
Divergence from AlphaVal
32%
Summary
With ROTCE of 8.2% vs. 8.2% cost of equity, fair P/TBV is 1.00x on $38.92 tangible book, implying $43.32 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 (8.2%) is below the minimum investors require (8.2%). This means the bank is worth less than the net assets on its books.
Wall Street's average price target is $64.00 (from 7 analysts). Our estimate is 32% 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