TFC
Truist Financial Corporation
$51.65
Banks, Insurers & Asset Managers
85%
P/Tangible Book × ROE Quality
Mild
·
Conviction
Fair Value
Trading 9.9% below fair value
You pay
$51.65
Bear
$40.11
Fair
$57.30
Bull
$74.49
Bear
$40.11
-22.3%
ROTCE 8.5% → 0.89x TBV
Fair
$57.30
+10.9%
ROTCE 11.3% → 1.46x TBV
Bull
$74.49
+44.2%
ROTCE 13.0% → 1.79x TBV
Adjust Assumptions
11.3%
9.0%
Key Value Driver
ROTCE (11.3%) vs. cost of equity (9.0%)
Implied Market Multiple
1.37x
Analyst Consensus (External Reference)
Never blended into the bear/base/bull estimates above.
Average Target (54 analysts)
$54.86
Divergence from AlphaVal
4%
Summary
With ROTCE of 11.3% vs. 9.0% cost of equity, fair P/TBV is 1.46x on $37.57 tangible book, implying $57.30 per share. DDM cross-check: $26.83.
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: $26.83 (53% 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