SMBK
SmartFinancial, Inc.
$41.64
Banks, Insurers & Asset Managers
85%
P/Tangible Book × ROE Quality
Mild
·
Conviction
Fair Value
Trading 6.6% below fair value
You pay
$41.64
Bear
$27.07
Fair
$44.57
Bull
$55.07
Bear
$27.07
-35.0%
ROTCE 8.3% → 0.99x TBV
Fair
$44.57
+7.0%
ROTCE 11.0% → 1.63x TBV
Bull
$55.07
+32.3%
ROTCE 12.7% → 2.01x TBV
Key Value Driver
ROTCE (11.0%) vs. cost of equity (8.3%)
Implied Market Multiple
1.56x
Summary
Our base-case estimate uses P/Tangible Book × ROE Quality. We then blend that result with the average analyst price target of $49.00 from 9 analysts, using a 20% weight on analyst consensus. That produces an estimated intrinsic value of $44.57 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: $10.09 (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