TMP
Tompkins Financial Corporation
$91.51
Banks, Insurers & Asset Managers
85%
P/Tangible Book × ROE Quality
Strong
·
Conviction
Undervalued
Trading 55.4% below fair value
You pay
$91.51
Bear
$139.86
Fair
$205.16
Bull
$240.27
Bear
$139.86
+52.8%
ROTCE 14.0% → 2.33x TBV
Fair
$205.16
+124.2%
ROTCE 18.6% → 3.42x TBV
Bull
$240.27
+162.6%
ROTCE 21.4% → 4.00x TBV
Key Value Driver
ROTCE (18.6%) vs. cost of equity (8.3%)
Implied Market Multiple
1.52x
Summary
With ROTCE of 18.6% vs. 8.3% cost of equity, fair P/TBV is 3.42x on $60.07 tangible book, implying $205.16 per share. DDM cross-check: $50.97.
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: $50.97 (75% 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