SYBT
Stock Yards Bancorp, Inc.
$75.09
Banks, Insurers & Asset Managers
85%
P/Tangible Book × ROE Quality
Moderate
·
Conviction
Fair Value
Trading 16.7% below fair value
You pay
$75.09
Bear
$60.31
Fair
$90.18
Bull
$108.11
Bear
$60.31
-19.7%
ROTCE 12.2% → 2.07x TBV
Fair
$90.18
+20.1%
ROTCE 16.3% → 3.10x TBV
Bull
$108.11
+44.0%
ROTCE 18.8% → 3.71x TBV
Adjust Assumptions
16.3%
8.0%
Key Value Driver
ROTCE (16.3%) vs. cost of equity (8.0%)
Implied Market Multiple
2.58x
Analyst Consensus (External Reference)
Never blended into the bear/base/bull estimates above.
Average Target (11 analysts)
$85.00
Divergence from AlphaVal
6%
Summary
With ROTCE of 16.3% vs. 8.0% cost of equity, fair P/TBV is 3.10x on $29.11 tangible book, implying $90.18 per share. DDM cross-check: $25.04.
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: $25.04 (72% 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