SMBK
SmartFinancial, Inc.
$50.84
Banks, Insurers & Asset Managers
85%
P/Tangible Book × ROE Quality
Mild
·
Conviction
Overvalued
Trading 14.0% above fair value
You pay
$50.84
Bear
$27.09
Fair
$44.60
Bull
$55.10
Bear
$27.09
-46.7%
ROTCE 8.3% → 1.01x TBV
Fair
$44.60
-12.3%
ROTCE 11.0% → 1.67x TBV
Bull
$55.10
+8.4%
ROTCE 12.7% → 2.06x TBV
Adjust Assumptions
11.0%
8.2%
Key Value Driver
ROTCE (11.0%) vs. cost of equity (8.2%)
Implied Market Multiple
1.9x
Analyst Consensus (External Reference)
Never blended into the bear/base/bull estimates above.
Average Target (10 analysts)
$53.00
Divergence from AlphaVal
16%
Summary
With ROTCE of 11.0% vs. 8.2% cost of equity, fair P/TBV is 1.67x on $26.73 tangible book, implying $44.60 per share. DDM cross-check: $10.21.
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: $10.21 (77% 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