TKOMY
Tokio Marine Holdings, Inc.
$45.75
Banks, Insurers & Asset Managers
85%
P/Tangible Book × ROE Quality
Moderate
·
Conviction
Fair Value
Trading 15.8% below fair value
Bear
$54.32
+18.7%
ROTCE 19.0% → 4.00x TBV
Fair
$54.32
+18.7%
ROTCE 25.0% → 4.00x TBV
Bull
$54.32
+18.7%
ROTCE 29.1% → 4.00x TBV
Adjust Assumptions
25.3%
6.0%
Key Value Driver
ROTCE (25.3%) vs. cost of equity (6.0%)
Implied Market Multiple
3.37x
Summary
With ROTCE of 25.3% vs. 6.0% cost of equity, fair P/TBV is 4.00x on $13.58 tangible book, implying $54.32 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.
Financial statements were converted from JPY into USD using USDJPY at 0.0063 USD per JPY.
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